We're all set for Y2K say shops and banks

By KARYN SCHERER

With just 10 days to go (including today) until the Y2K countdown, most of the country's retailers and banks profess to be supremely confident it will be all right on the night.

Research carried out by the Y2K Readiness Commission reflects their optimism. The banking and finance sector is estimated to be best-prepared of all businesses for Y2K issues, getting a 100 per cent mark on its scorecard.

"If there's a simple message, then it's that all the banks are very confident that Y2K will present no problems at all," says Bankers' Association spokesman Colin MacDonald.

Many banks have already had to deal with Y2K-related glitches during the year. For months, all have been extensively testing their systems and associated equipment such as door locks. Most have written to customers telling them they have nothing to worry about.

The banks plan to restock ATM machines as and when needed and are confident enough money will be available in case of a last-minute rush for cash.

When the Reserve Bank issued its new plastic notes, it held back the old paper notes, ensuring an extra $2.4 billion will be sitting in the vaults if needed. The extra money comes on top of the normal reserve of $2 billion and the $2.2 billion already in circulation.

Deputy governor Rod Carr says: "There have been a few anecdotes of people withdrawing investment sums - but very few anecdotes.

"Our view is it's a really silly thing to do. Why would you take money which is safe in a bank and stick it in a shoebox and risk either losing it or spending it?"

Like most organisations, the Reserve Bank will have key staff working on New Year's Eve. Among other things, they will take part in a series of conference calls with international organisations such as the World Bank.

But the main test will not come until January 5 - the first settlement day for most banks.

While the scenario looks reassuring for banks, the picture is a little more uncertain for retailers and wholesalers.

At the end of October, only 77 per cent of retail and wholesale businesses surveyed by the Y2K Readiness Commission had fixed potential software problems and only 63 per cent had tested their systems. The sector ranked behind pharmacists, government departments, accountants, local government, tourism and essential services in terms of overall preparedness.

The chief executive of the Retail Merchants Association, John Albertson, is nevertheless hoping problems will be few, if any.

"The biggest risk, of course, is the eftpos system, but talking to [eftpos company] ETSL and the banks, they're all extremely confident everything will go tickety-boo," he says.

The country's main supermarket chains have been extensively testing their systems. Most plan to turn off their power supplies and rely on generators for several hours during the changeover, in case of power spikes.

Des Tindall, IT manager for Foodstuffs Auckland, says the group's stores, including Pak 'N Save, New World and Write Price, have been fully prepared for at least nine months.

"We anticipate no problems at all, but we will have a team on standby just in case."

At Woolworths, key staff have been ordered to remain within an hour's reach of the chain's "national crisis centre" in Auckland, until January 10.

All its stores are required to go through a lengthy checklist between midnight and 5 am on January 1. They also have to report to head office again on January 2 when most open their doors.

It has been a bad year for Woolworths' parent company, Singapore-based Dairy Farm International. A major earthquake in Taiwan, riots in Jakarta and floods in India have ensured a crackdown on contingency planning.

Spokesman Des Flynn says: "Obviously the rest of the group will be watching with interest what happens in New Zealand for international implications."

At the country's largest non-food retailer, The Warehouse Group, most staff will have New Year's Eve off. But key staff are expected to be at work from 6 am on January 1. Unlike many other retailers, Warehouse stores plan to open on New Year's Day from midday.

The group's chief information officer, Neville Brown, estimates the company has spent more than $1 million on Y2K-related issues. It has worked closely with suppliers, and has put in place an array of contingency plans in case something goes wrong.

"I don't think you can be totally confident but we've done a lot of preparation work," he says.

Whether smaller, independent retailers are as well prepared remains to be seen.

Mr Albertson says: "If push comes to shove, they can resort to temporary manual systems anyway. Being retailers, they'll find a way of making the sale."

ETSL, the organisation set up by four trading banks to run the country's dominant eftpos system, says that will not be necessary.

ETSL has already tested its system, using forward dates, and has worked with banks, Telecom and some major retailers to ensure it works. It has also ensured that older types of terminal which are not Y2K-compliant are no longer around.

General manager Ron Brown is one of several staff who will be at work at midnight on December 31 to ensure everything goes to plan. He will be accompanied by representatives from several US-based software and hardware companies, keen to be at the first place in the world to witness the changeover.

Staff have also been asked to test several plastic cards for overseas companies.

"There are a number of things that will actually have to happen further down the process before we can all sit back and say, 'yes, we did a good job'," says Mr Brown. "Once the business community is back functioning, that's really the time when we'll take a breath."

In fact, many businesses may have to wait even longer - until February 29, since some computer programmers were unaware next year would be a leap year.

It could be March, Mr Brown says, before he really starts to relax.