Tel Aviv 2019

Backup plans and shutdown threats : Israel deposit crisis esclates 24 hours before the deadline

As we reported yesterday, Israeli broadcaster IPBC has not yet paid a financial guarantee of 12 million euros to the EBU. Today, the EBU and the Israeli Government have issued several statements regarding the situation, as we enter the last 24 hours before we reach the deadline.

What is the “deposit crisis”?

Israel won Eurovision in 2018, and as such, is entitled to hosting the next edition, in 2019. They accepted to host, so it is now the role of the new public broadcaster IPBC (whose main channel is KAN) to organize the events.

Because of the situation in Israel (new broadcaster, tensed local geopolitics, etc.), the EBU requires a garantee deposit of 12 million euros. It serves two purposes: first, it would prove that the country and broadcaster have the financial capacity to host ; and second, if events lead to the cancellation of the contest in Israel, the deposit can be used to fund the back-up plans. However, if all goes well, the 12 million euros should go back to the IPBC once the 2019 contest finishes.

The crisis is simple: the IPBC asked for financial help from the Government in order to pay the deposit. The Government, however, stated that the IPBC has a yearly budget of 178 million euros set by the law and should use this budget. The IPBC responded by explaining that paying 12m euros now to the EBU would force them to either cut down on other productions or on staff (up to 200 redudancies). Moreover, they explained that their annual budget could not take into account the extra cost of organizing the contest, as it was voted in 2017.

The deposit should have been paid by August 1st. With the situation at a standstill, the EBU agreed to extend the deadline to August 14th: tomorrow.

The new developments

The Government stands its ground and threatens the IPBC

This morning, Finance Minister Moshe Kahlon maintained that the IPBC was able to pay, and that his department would not give the broadcaster extra fund to secure the hosting rights.

Speaking to the Israeli website Ynet, the Minister stated this :

They are able to put up the guarantee. If they don’t transfer the guarantee, they will be making a serious mistake. The corporation is a public entity, it gets money from the public and it needs to work according to rules.

Holding the Eurovision [in Israel] depends only on the broadcaster. There is no one standing in its way.

Moshe Kahlon
Moshe Kahnon, Finance Minister of Israel © Yonatan Sindel / Flash 90

Later today, Prime Minister Benjamin Netanyahu went even further. According to Haaretz, he threatens to shut down the broadcaster if it fails to send the deposit to the EBU before the deadline. Several senior officials at the Ministry of Finance have stated that, should the IPBC refuse to draw from its set buget, the Prime Minister will introduce a bill to shut it down.

However, it is not certain such a bill would be voted by Parliament. Yet the message is clear enough : the Government won’t be paying anytime soon.

The EBU reacts

Contacted by fellow Eurovision website ESCtoday.com, the EBU released the following statement regarding the ongoing crisis in Israel :

The EBU is working closely with KAN ahead of tomorrow’s deadline, on advancing arrangements for next year’s Eurovision Song Contest in Israel. Every year financial guarantees must be made to the EBU before plans are put in place and the host city for the Eurovision Song Contest is announced. If a situation ever arose in which a broadcaster could not fulfil their requirements there are always contingency plans in place, as is normal when planning such a large event with many international stakeholders.

EBU

There has already been several rumours about the back-up plans for 2019. It would seem fair to give priority to the runner-up, Cyprus, yet many believe the island might not be financially capable of hosting the contest. The two options regarded as the most serious are Austria (finishing 3rd this year and having hosted the contest recently), then Germany (who would host should Australia win, and which was assumedly and unofficially the backup plan in 2017).

What do you think? Is “Israel 2019” seriously threatened or is this just national politics and administrativive feud? Will the EBU extend the deadline should the IPBC refuse to pay? Tell us more in the comments below or on social media at @escxtra !

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