Having taken over the New Democracy leadership after his surprise win in the conservatives’ January 20 elections and subsequently met with other party leaders, Kyriakos Mitsotakis now faces the challenging task of getting the political group’s finances under control.
Mitsotakis has inherited the control of a heavily indebted organization. New Democracy’s debts stand at 210 million euros, 197 million of which are bank loans.
To compound the problem, there is no way that the party’s revenues can cover the servicing of this debt, particularly since state funding for parliamentary parties has been slashed. New Democracy is due to receive just 1.5 million euros in taxpayer money this year.
This means the party does not have enough to cover all that it owes, let alone staff salaries, rent and overheads. Sources said New Democracy currently owes some 5 million euros to suppliers and another 5 million in rent. Also its 195 employees have not been paid in at least six months, which amounts to around 1 million euros in unpaid wages.
Mitsotakis has already begun reducing the party’s costs by shutting down its Democracy Institute, which employed five people. Sources said that the conservative leader will also put together a voluntary redundancy package for party staff, with the aim of reducing the total number of employees to between 50 and 60.
Another cost-saving move will be to leave the party’s current headquarters on Syngrou Avenue for smaller and cheaper premises.
Mitsotakis is also preparing to propose at the party congress planned for April 15 to 17 a streamlined organizational structure and a reduction in the number of members on New Democracy’s political committee.