The small orange wire supplies the light bulbs throughout the dash. Its presence in the column is for either A) the auto trans selector lighting, or B) the ignition key light. But these are all wired together throughout the orange wire harness so all of these lights illuminate together. If yours is disconnected in the column, one or both of those two lights is not coming on with the rest of the lighting.
Why would someone disconnect that...hard to say. It's possible someone at some time replaced one of the bulbs with too powerful a replacement, it melted something, and rather than get the correct bulb, they disconnected the power. Maybe they replaced the radio with an aftermarket unit, nicked the orange wire, and through improper troubleshooting capability, disconnected the column wire. One thing I've learned working on old cars is to never underestimate previous owner's willingness to hack things up.