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Home Page: Year 2000 Economics

Deceptive "Progress" of U.S. Government Y2K Repairs

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Apparently, the nation?s capitol is woefully behind in its Y2K remediation efforts. To anyone who follows Y2K this is obvious. Many news stories have reported on the "Amazing progress of the U.S. Government" after hearing media sound bites quoting John Koskinen saying 92% of mission-critical systems are compliant.

This is as misleading as it gets. For one thing, no one seems to ask the question "what is mission critical?" Is getting paid mission-critical? The most glaringly obvious conclusion we can see from the table shown below is that the number of systems deemed "mission-critical" keeps dropping! This has the effect of artificially raising the percentage of systems that can be be called compliant. Using the Aug. '97 figures for systems deemed "mission-critical," for example, would indicate that it is only (approx.) 55% complete. So what about the other 66,000 systems the government has? Are they not necessary? If they aren't, why do they have them in the first place?

The OMB has compiled these reports since May 1997 from information provided by federal agencies on the 15th of February, May, August, and November.

The following table shows the total number of mission-critical systems reported by the 24 federal agencies every quarter. Also shown are the percentage of systems that are compliant, the official estimated cost, and the number of agencies that are in trouble. It shows that 61% of critical systems were ready as of mid-November 1998, and that six agencies were seriously behind schedule.

US Federal Government Progress Report
Report No.
and
Date
Number of mission-critical systems Number of compliant systems Percent complete Official estimated cost to fix
(billion $)
Agencies in trouble
1. May '97 7,649 1,598 21 2.8 0
2. Aug. '97 8,562 1,646 19 3.8 5
3. Nov. '97 8,589 2,296 27 3.9 7
4. Feb. '98 7,850 2,716 35 4.7 6
5. May '98 7,336 2,913 40 5.0 6
6. Aug. '98 7,343 3,692 50 5.4 7
7. Nov. '98 6,696 4,049 61 6.4 6
8. Feb. '99 6,404 5,059 79 NA NA
Source: Office of Management and Budget

The data in the table above include mission-critical systems that are being replaced. The following table looks just at those that are getting repaired..

US Federal Government Progress Report: Mission Critical Repairs
Report No.
and
Date
Number of mission-critical systems Number needing repair Percent renovated Percent validated Percent complete
1. May '97 7,649 4,493 17 5 6
2. Aug. '97 8,562 5,332 12 5 2
3. Nov. '97 8,589 5,124 34 17 10
4. Feb. '98 7,850 4,413 46 24 19
5. May '98 7,336 4,395 55 32 27
6. Aug. '98 7,343 4,640 71 44 37
7. Nov. '98 6,696 4,122 90 60 52
Source: Office of Management and Budget Representative Stephen Horn (R-CA), the Chairman of the House Subcommittee on Government Management, Information, and Technology, has been monitoring the progress reports very closely. On September 15, 1997, he presented his first report card on the progress made by the federal government?s 24 agencies based on the data compiled by the OMB. The table below reproduces the federal government?s transcript.

Agencies projected to finish before the March 1999 deadline earned a "base" grade of A. Those finishing later in 1999 received a base grade of B. Finishing in 2000 merited a base grade of C; in 2001, D. Anything after 2001 was an F.

The actual grades reflected additional factors that raised or lowered the base grade including:

1) Replacing systems. Because agencies have a poor track record of delivering new systems on time and on budget, when an agency reported a high percentage of mission-critical systems as being replaced rather than repaired, the grade was lowered.

2) Strong management involvement. If the senior executives of an agency have taken a leadership role and demonstrated significant involvement in the Y2K project, the grade was raised.

3) Business continuity plans. Many agencies are preparing contingency plans, but only for those systems they know will be late. Such plans must focus on business continuity, i.e., maintaining basic operations if systems fail.

4) External Data Exchanges. Most computers exchange data with other computer systems. External data that is not Y2K compliant can corrupt systems that are ready.

Congressman Horn also raised or lowered the grade depending on the agencies? attention to potential Y2K problems with telecommunications and embedded microprocessors systems.

In his seventh assessment of the federal government?s progress, Rep. Stephen Horn, the Chairman of the Subcommittee on Government Management, Information, and Technology, gave the government only a "C+" during the quarter ending February 15, 1999. This was an improvement over the previous three quarters, when it garnered an "F" and two "Ds."

Year 2000 Progress Report Card
Agency 1997
8/15
1998
2/15
1998
5/15
1998
8/15
1998
11/15
1999
2/15
Social Security Administration A- A A+ A A A
Nuclear Regulatory Commission D C- B D C- A
National Science Foundation B A A- A A A
Small Business Administration B B B A A A
Environmental Protection Agency C B B B B+ A
HUD C B C C C A-
Department of Veterans Affairs C A C B- B- A-
General Services Administration B C A- B+ B+ A-
Department of the Interior C C- C- D B A-
Department of Education F F D F C- A-
Office of Personal Management D B C- D C- A-
FEMA C D- A- B- B B+
NASA D- D B C+ C+ B+
Department of Commerce D B B B B B
Department of Justice D C- D F F B
Department of Labor C F C D C B
Department of Energy D D- F F F B
Department of the Treasury D- D C D+ C B-
Department of Health & Human Services B- D F F F C+
Department of Agriculture D- B D C C C
Department of Defense C- F D D D- C-
Department of State C F F F F F
Department of Transportation F F F D D F
Agency for International Development F D- F F F F
Administration Overall - D- F D D C+
Source: Congressman Stephen Horn. http://www.house.gov/reform/gmit/y2k/index.htm


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