On the House: Good Samaritan

The Government's good Samaritan legislation is welcome, but should give no one cause for complacencyPassage of the Year 2000 Information Disclosure Bill 1999 through the Federal Parliament is an undeniably welcome step along the Australian road to Y2K preparedness.

However the fact that the Government has finally bowed to pressure by the Opposition, NSW Government and IT industry to introduce "good Samaritan" legislation limiting liability from Y2K disclosure should give no one cause for complacency.

The national legislation, passed with the endorsement of ministers from every state, does nothing to lessen the likelihood of Y2K incidents being transformed into class action, negligence, liability, breach of contract, warranty claims and misrepresentation suits.

Instead it is designed to provide limited legal protection for statements about Y2K readiness made "in good faith" by ensuring statements admitting problems with compliance will be inadmissible as evidence. The idea is to encourage organisations to provide a clear picture of the steps they are taking to address the Y2K bug.

The legislation will run until June 30, 2001, giving companies time to fix problems that fail to manifest until after the Y2K "deadline" of January 1, 2000.

How effective the legislation will ultimately prove to be is uncertain. In the US, President Clinton's signing of good Samaritan legislation late last year has done nothing to ease their reluctance, built on fears of legal exposure created by unwise year 2000 disclosures.

A US Computerworld analysis published in January found many companies were completely ignoring the SEC directive to file meaningful statements about potential exposure to their businesses from the year 2000 problem. So reluctant were they to put anything on record they typically failed even to state whether they had hired an independent consultant to verify and validate their software remediation.

Amongst the serious ramifications of the general failure to disclose is the fact that the level of information now being reported simply isn't enough to allow other companies to make Y2K compliance decisions about supply-chain or business partners. Nor can shareholders make investment decisions based on the scant information being disclosed by companies, analysts say.

At least the Australian Federal Government seems finally to have woken up to the fact that Australian businesses have been experiencing similar problems determining the likelihood of Government systems and functions passing January 1, 2000 without causing any major problems to business.

The industry has been concerned for a while that the Government's reluctance to provide details about the preparedness of departments and agencies to face the Y2K issue signalled a failure by some to have effectively dealt with the issue.

Now the Government claims it will in future provide full details of each department and agency's compliance testing and repair activities in its regular reports.

With Government officials keen to stress the key role the Government is playing in preparing Australia for the millennium bug, it is high time it set the example by disclosing, fully and frankly, the extent to which Y2K work has been completed.

Otherwise the natural reluctance of business to comply would only be compounded by the Government hypocrisy.

Sue Bushell is a Canberra-basedpolitical correspondent

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