LETTERS - The price of bills on time

Barbara Roche MP states (Profile, 24 April) that a Labour government will require national and local government bodies to pay its bills ‘on time’ (within 30 days).

Many people, particularly firms supplying goods and services to the public sector, will welcome this policy. However, like all good ideas, the policy will increase public spending for the year in which it is implemented.

The public sector currently spends around #1bn per week on goods and services purchased form the private sector. Assuming that the ‘pay-on-time’ policy is implemented in full in 1997/98 then, for every day by which the average credit period is reduced, public spending will increase by around #150m in 1997/98. By way of example, if the average credit period was currently 40 days then the impact of reducing this to 30 days would be to increase public spending in 1997/98 by #1.5bn. There will, of course, be no equivalent ongoing saving in subsequent years since the effect of the ‘pay-on-time’ policy is to permanently accelerate cash spending as compared to previous years.

Given that Chancellor Gordon Brown has stated he will stick to public spending forecasts, he may be asked at some stage to confirm that Barbara Roche’s ‘pay-on-time’ policy has been sanctioned by his office. If it has, then analysts will shortly be asking which other areas of public spending will be cut back to finance the ‘pay-on-time’ proposal.

Maurice Fitzpatrick, Chantrey Vellacott, London

PCs can deal with 2000

The article on the cost of 2000 compliance stated that ‘the two-digit date code which computer chips currently use will not be able to distinguish between 1900 and 2000, causing them to crash’, (News, 17 April)

This is wrong. PC operating systems have always used a four-digit year and, since at least 1991, have allowed dates up to 31/12/2099 to be set.

Just type DATE at a DOS prompt and try it out.

I accept there is software currently in use which only uses two-digit years. But surely IT-intensive companies will already have upgraded themselves to four-digit year software by way of natural upgrades. A program, having stored the date with a four-digit year, can then simply treat it as a number.

Are there companies out there with software using two-digit years? If so, they’ll be unable to generate date-sensitive reports which straddle 2000 (such as a VAT return). This is a problem that only occurs during the ‘transition’ to the 21st century, and it can be overcome with a small amount of common sense – generate a report on each side of 2000.

JP Wattam, Southampton

Explaining the date crisis

No one disputes changing the year from 99 to 00 will, in itself, cause any problems. Even if the date in the computer clock of a PC changes to 1980 one second after 23:59:59 on 31/12/99, the year can be changed to 00 via the keyboard. It is the use of the date in computer programs which has to be considered.

No date will be held in computer records earlier than 01/01/00. Therefore, an age analysis of customer debts at the end of January 2000 will not identify unpaid December 1999 invoices as being ‘over 30 days’. If anything, they are minus 99 years, 11 months.

Historical data is often stacked according to the relevant dates in ascending or descending order. Employees’ rates of pay is one such type of data, and the current rate of pay is that last one recorded in date order before the current date. What is the last rate recorded before 1 January 2000; is there one?

Personnel systems may maintain a ‘stack’ of the positions held by an employee with the earliest one at the bottom of the stack and the latest at the top. Giving an employee a new post in January 2000 will put that job at the bottom of the stack unless the date is held in such a format that the date can be recorded with the century.

Michael Ridge, East Molesey, Surrey

Confiscating MPs’ assets

On reading Michael Stern (View from the House, 27 March), I wonder whether his suggestion of increasing powers relating to the seizure of wrongdoers’ assets has been discussed with any of his former colleagues in the House of Commons who have been investigated by Gordon Downey, Sir Richard Scott or Lord Nolan.

Alan Scott, Sudbury, Suffolk

Job threat from EMU

The Hundred Group of Finance Directors’ report on the single European currency (News, 27 March) fails to address the important political issues.

Matters of importance to the electors within a democracy need to be settled by those they elect not by unelected bureaucrats and unelected bankers.

The high levels of unemployment within the EU are not acceptable. As The Times has said: ‘EMU is devouring jobs, growth and harmony in Europe.’

Denys Seager, Winchester

A swindle not so complex Your description (News, 10 April) of Robert Feld’s swindle as ‘breathtaking in its simplicity and ingenuity’ is an exaggeration of talent.

While the Inland Revenue, Contributions Agency, NatWest Bank and other responsible organisations still use stationery and letter headings printed in black on white paper, there will be ample scope for letters to be falsified using the simplest of office equipment which may even be dispatched through postal channels.

In risk areas, there should be a requirement for organisations to use letter headings of at least two colours, not to mention other security procedures available. This will at least narrow the field to the fraudster with access to a colour photocopier.

Raymond Keene, New Barnet

Peter Brown

Prem Sikka accused me (Letters, 1 May) of failing to mention that I am a candidate for the forthcoming 1997 ACCA council elections.

The letter I wrote to the editor of Accountancy Age did make that disclosure.

However, in the process of editing my letter for publication (3 April), it seems that you deleted the information regarding my candidature. This, unfortunately, led to Mr Sikka’s mistaken imputation.

I would be glad if you could put the record straight.

Peter Brown, Esher, Surrey

Guide speaks volumes

I have just received the Inland Revenue self-assessment tax return guide for tax practitioners and I have one simple question: if the new system is truly as simple and clear as the Revenue claims, then why does the new guide have to be larger than my telephone directory?

David Turner, Enfield

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