NZ Budget ignores Y2K issue

NZ Budget ignores Y2K issue

New Zealand and Australia appear to be taking opposite tactics in the way they address the year 2000 issue.

The Kiwis' 200-page Budget document contained not a word on the year 2000, while Australia has marked it out as a special point of focus. New Zealand's United party leader Peter Dunne, a long-time advocate of Y2K policy, described the situation as ludicrous.

"Treasury still hasn't done any detailed assessment of the problem's impact on our economy," Dunne said. He points out that while the Asian crisis is mentioned repeatedly throughout the Budget, the Y2K issue has the potential to be just as serious. "It's in the 'too-hard basket' for them."

Dunne hopes there will be some response from the New Zealand government to the Y2K inquiry in the near future, but when is another issue. "Time is simply passing us by. I had hoped to see it in the Budget but that wasn't to be."

The Australian Budget, released in the same week as the New Zealand Budget, includes several hundred million dollars worth of extra Y2K spending. Any expenditure on software or labour to repair or upgrade systems will be tax-deductible.

The New Zealand Budget, however, contains no extra funding for Y2K-compliance projects, no funding for awareness programs and nothing about the tax implications of the Inland Revenue Department's (IRD's) position paper on Y2K. "There's nothing there. The contrast between the Budgets is stark in that context."

Dunne proclaimed five steps the NZ government should take to ensure it can cope with Y2K.

"We should freeze all new Government IT projects unless they are directly related to fixing the problem.

"I would like to see the prime ministerial task force set up as soon as possible and appoint a minister with special authority," Dunne said.

The final point Dunne would like to see raised is the taxation issue. "We need to look again at the depreciation regime for software." He would like to see something similar to the model proposed in the Australian Budget.

But Ministry of Commerce spokesman Reg Hammond says the New Zealand Government is addressing the Y2K issue -- it's just not doing it through the Budget.

"IRD released its position paper a few weeks ago and the select committee report has been tabled in Parliament already. The Aussies might have covered it in their Budget but we chose to cover it prior to the Budget."

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