The Spanish government has agreed to pony up E3.2 billion ($4 billion) to help pubcaster Radio Television Espanola pay about a third of its long-term debt.
According to a draft 2007 general budget, remaining debt will be covered via budgetary allocations over 2008-10.
Coverage of RTVE’s huge debt by Jose Luis Rodriguez Zapatero’s ruling socialist party is the second large step toward putting RTVE on an even financial keel.
In September, RTVE staff endorsed a plan to cut 4,150 jobs, slashing the workforce to 6,500.
In further radical restructuring, the Spanish government plans to cover the costs of RTVE’s public broadcasting services for 2007, estimated at $541.3 million, via a state subsidy, and has proposed a capital increase for 2007 of $375 million for one-time expenses.
State-backed turnaround company SEPI, which is overseeing RTVE’s restructuring, will contribute $281.3 million to the capital increase, SEPI prez Enrique Martinez Robles told the Spanish press.
The capital increase could give RTVE some desperately needed leeway to continue investing in programming and acquisitions in order to maintain the competitiveness of its main free-to-air channels, TVE1 and La 2.
Renamed Corporacion RTVE in September, the pubcaster also will receive $230 million to liquidate RTVE’s former public structures.
Job cuts will reduce staff costs by 44% to $342.5 million a year.