The finance committee of the Broadcasting Authoritys plenum assesses that Channel Ones deficit will amount to NIS 40 million at the end of 1999. The Channel One budget for 1999 was NIS 320 million. By the end of October, the Channel had spent NIS 296 million. Assuming that the current spending rate persists until the end of the year, total expenditure will reach NIS 350 million.
Added to that expense should be a NIS 10 million cost for retroactive salary payments to employees due to a wage agreement. In all, Channels Ones expenses will amount to NIS 360 million.
Management claims that the deficit arises from a number of items not budgeted at the beginning of 1999.
A Channel One executive said the IBA Channel One and Voice of Israel would end 1999 on a deficit of only NIS 7.5 million, or 1% of the budget. He added "In a year so crazy from the point of view of events, many institutions would be happy if they could wind up with so small a deficit".
The IBA budget for 1999 stood at NIS 736 million. According to the performance report for January-October 1999, 84% of the budget had already been spent.
The IBA plans to demand that the Ministry of Finance increase its 2000 budget to NIS 750 million. Approval for a larger budget will involve a hike in viewer fees. The Knesset Finance Committee will review the matter tomorrow.
Alon Alroi, chairman of the IBA finance committee, said "In light of the 1999 figures, there can be no doubt that the financial management of Israel television is most deficient. These facts must be taken into account when considering the 2000 budget".
Channel One director Yair Stern commented that he could not negotiate with the finance committee through a newspaper.
Published by Israel's Business Arena November 21, 1999