Robin Guenier is executive director of Taskforce 2000, an independent firm of millennium bug advisers. He says: "The Bank of England said in one of its recent booklets that the FSA doesn't have the technical expertise to judge the readiness of particular banks and financial companies.
"But if they can't go out and check things technically, how can they possibly be a regulator? All they're doing is passing on messages that other people give them, which is hopelessly unsatisfactory."
Speaking at an Action 2000 press conference this week, Michael Foot, of the Financial Services Authority, said: "Our particular focus is on those [companies] with a potential high impact on consumers and markets. The large majority of these are either on track for Year 2000 compliance, or - if behind - are well-placed to catch up on time."
But the FSA refuses to put any concrete figures on these very vague assertions. It will not say what "broadly on track" means, what constitutes a "large majority", how many of that large majority are behind, or how far behind they are.
Andrew Hull, assistant director of Taskforce 2000, says: "A majority could mean 51 per cent, and you can't draw much reassurance from that. To say a majority are getting on with it may well be true, but we want 99.999 per cent." Pressed on this point, the furthest an FSA spokesman would go was to admit that "a few" companies in its industry are still in the FSA's red zone, which indicates that there is a danger they may not be compliant in time.
Guenier believes many financial services companies are behind schedule in their own compliance work. He says: "They are more advanced than many industries are, but they're not as far advanced as they thought they would be at this time."
Hull adds: "The financial sector is generally more on top of it than other sectors. But, conversely, the financial sector is is more dependent on technology and more affected by confidence issues. Confidence is all- important, so they need to be ahead."
Another contributor to Thursday's proceedings was Michael Lewis, deputy chief executive of the banks' Association of Payment Clearing Systems. He said: "BACS, which clears salaries, wages, direct debits, standing orders etc, is Year 2000 ready and tested. The cheque-clearing system is also ready and tested, as are Chaps sterling and Chaps euro, which clear high-value same- day payments. We are also confident that cash-dispensing systems will operate normally, with an ample supply of cash throughout the UK."
Guenier says: "I don't really anticipate problems with people's bank accounts, cash machines and so on. The worries are more about the global economy and the inter-relationships banks here have with banks internationally. There are some real concerns."
Another millennium bug study out this week - backed by Taskforce 2000 - warns that 45 per cent of Britain's 1,000 biggest companies have barely begun their own compliance programmes. These companies have yet to complete their inventory of equipment containing embedded microchips, an essential first stage to dealing with any problems.
Julian Stait is a partner at Dibb Lupton Alsop (DLA), a big law firm specialising in Year 2000 issues, which conducted the survey. He says: "How can those companies be confident they will finish on time before they even know what the precise extent of their task is?"
Over a quarter of the companies contributing to the DLA survey (26.7 per cent) are from the financial or business services sectors. One problem in the DLA report is that four out of 10 big companies have failed to appreciate the fact that safety issues alone may be enough to cause real problems.
Your bank may well have its main computers working perfectly. But what good is that if officials have barred staff from the building because the fire alarms are no longer reliable? The Health & Safety Executive has already promised a crackdown on issues like these.
Stait says: "If they have a fire alarm, or a sprinkler system, or a lift which contains embedded chips - as all of those things will - then they will have a health and safety issue.
"A significant number of the top 1,000 companies are behind where they should be. They indicated a large degree of confidence that they would be compliant on time, but that confidence may be misplaced."Reuse content