Spain'sMinistry of Culture has unveiled an "action plan" for Spanish film, including increased subsidies and the creation of a new mutual guarantee fund.

Presentedin Madrid by Minister of Culture Carmen Calvo, the initiative targets production, distribution and exhibition.

The most significant measure is an increase to the 2006 budget of the Spanish Film InstituteICAA's Cinema Protection Fund, from $40.2m (Euros 33m) in 2004 to $78.8m (Euros 64.5m).

TheMinistry has also announced the official creation of the $7.3m (Euros 6m) mutual guaranteefund Audiovisual Aval SGR, backed 50% by the producers' rights managementbody EGEDA.

The fund will provide personal guarantees to help businessesaccess and negotiate better conditions on bank loans for any activity withinthe production, distribution, exhibition or technical sectors.

Immediateindustry reactions were tepid. "This money is nothing less than an updatingof the Fund to the necessities of the industry," said Andres Vicente Gomez, CEOof Lolafilms.

"Nothingwill change in our lives except maybe the security of knowing the Ministrywon't run into so many delays." For Gomez, the guarantee fund is too small torepresent any serious help to individual companies.

Other measures announced include changesto the subsidy system with an 11% increase on the global cap that films canreceive through automatic, box office-linked subsidies from $1.1m (Euros901,518) to £1.2m (Euros 1m.)

Upfrontsupport awarded to new directors, experimental and low-budget films are raisedfrom $0.44m (Euros 0.36m) to $0.6m (Euros 0.5m) per project, up to a maximum of60% of the budget.

The global budget for the upfront help increased almostthreefold to $7.3m (Euros 6m) in 2006, from $2.9m(Euros 2.4m) in 2004. The criteria to be considered low-budget was modified from $1.2m (Euros 1m) to $2.4m (Euros 2m).

AlquimiaCinema producer Francisco Ramos is awaiting reimbursement on automaticsubsidies for four different 2002 releases.

"Thebest thing out of this is the paying off of debts, but the increases insubsidies are still not sufficient," he said.

"Ifyou consider the $1.1m (Euros 0.9m) cap has been in place since 1992 we shouldnow be at $1.5m (Euros 1.2m)."

Budgetsfor distribution subsidies were increased from $1.1m (Euros 0.95m) last year to $1.8m (Euros 1.5m) this year.

The Ministry confirmed that "thesesubsidies will be conceded in a preferential manner to independent distributorsand not to those with non-EU capital whose power within the Spanish market ishardly compatible with public aids."

Newlow-interest loans will also be made available for independent distributioncompanies handling European or Iberoamerican films to invest in the acquisitionof rights, promotion or copies.

Distributors planning to legally launch filmsonline can also access support for the first time, a measure intended tohelp fight piracy.

Anautomatic subsidy to exhibition chains programming mostly European andIberoamerican cinema, subtitled films or a minimum number of short films eachyear is currently under consideration.

Meanwhile, the government opted againsta change to the current screen quota system, which requires exhibitors to playone day of EU films for every three of dubbed non-EU films.

Finally,the Ministry has promised funds to the Ibermedia Co-production Fund, including$0.36m (Euros 0.3m) for the creation of a new line of support for documentaries;increased aid for Spanish films traveling to international festivals; and thecreation of a Centre for the Conservation and Restoration of Spanish movies.