HOSPITALS have been fooled by the so-called millennium bug into cancelling operations in the mistaken belief they had run out of sterile supplies, a computer software company claimed yesterday.

Richard Coppel, chief executive of Prove It 2000, said hospital computer systems had told surgical staff that there was no sterile equipment in stock.

In fact, he said, the cupboards were fully stocked with equipment with a use-by date of 2000, which the computer system did not recognise.

''The impact of this kind of scenario would pale into insignificance if critical medical equipment failed in a similar manner,'' said Mr Coppel, who was launching a survey commissioned by his company which indicated that more than a third of NHS trusts, hospitals, and GP surgeries had not invested any money in tackling the millennium bug.

Prove It 2000 claimed it was now too late to fix the bug problem in the NHS by the deadline and warned that patients could be put at risk.

Preliminary findings of the poll of more than 1000 health service organisations showed that, so far, on average they had spent just #15,000 on dealing with the problem, and 36% of those interviewed had spent nothing.

Managers must carry out a damage limitation exercise, the company claimed, prioritising the most critical services and ensuring that contingency plans were in place.

Mr Coppel said: ''These findings are very disturbing and contradict the Government's message regarding the public sector's readiness for the Year 2000.

''The thought that system critical equipment such as operating theatres have not been tested for Year 2000 compliance chills me to the bone.''

He would not name the hospitals where operations have been cancelled, but it is understood they include a major one in North London.

A spokesman for Mr Coppel said last night: ''These are not just anecdotes, it is really happening. The bug is already biting.

''It can happen in any big hospital where the sterile supplies are stored some distance away from the theatres. They are inventoried on computer and delivered on a just-in-time basis so that everything runs smoothly.

''It isn't just a matter of going over to a cupboard and taking a scalpel down from the shelf.''

The Department of Health rejected the comments, adding: ''The NHS is on target and there will be a lot more done over the coming months as plans start to accelerate. It is an important issue and it is important that we get it right.''

The survey found that 24% of NHS administration systems were so far millennium compliant, but on average just 3% of the total annual information technology budget was being allocated to the year 2000 problem.

The full survey will be presented to a conference of NHS managers in charge of the Year 2000 strategy in July.