Meanwhile, to boost confidence in his country's public finances, Rajoy's government said Friday it had increased its savings plans over the next three years by 57 per cent, for a total of €102.1 billion ($125 billion) through 2014.
"I haven't made a decision (on a bailout) yet," Rajoy said after a cabinet meeting. "I want to know what the unconventional measures proposed by the ECB are. We do not know what is being proposed."
A day earlier, the ECB warned it would only help lower a country's borrowing costs if that country's government applied for rescue aid from the bailout funds set up by the 17 euro countries. Such a request, however, would come with conditions, such as extra savings cuts.
Spain borrowing costs are high due to concern over the country's ability to cover huge losses in its banking sector and big debts among regional governments.
With the ECB's role in helping Spain still uncertain, the government said Friday it had submitted to the European Commission a document outlining its spending cuts and revenue increases through 2014.
A statement on the prime minister's official website said the plan will save €13.1 billion ($16 billion) this year, €39 billion ($47.8 billion) in 2013 and €50.1 billion ($61.4 billion) in 2014. The total is 57 per cent greater than the amount previously forecast, and all of Spain's regional governments will be required to contribute to the savings, the government said.
The statement forecast Spain's economy would grow at a rate of 1.2 per cent in 2014, by which time it is expected to begin creating jobs.
Concern over Spain's finances remains intense and that was apparent in financial markets. The interest rate, or yield, on Spain's benchmark 10-year bond ended the day at 6.82 per cent, down sharply from Thursday but still dangerously high.
The yield had dropped to 6.5 per cent last week after Draghi first intimated he would apply measures that would help ease the pressure on borrowing costs. By comparison, the rate demanded by investors for Germany's more trusted 10-year bond was 1.34 per cent.
Rajoy told reporters that he had sent a letter to European Council President Herman Van Rompuy and his European Commission counterpart, Jose Manuel Durao Barroso, urging for recent proposals for greater EU banking union to be approved in December.
"If we really want to speak of a political project, a project for the cohabitation of millions of citizens, disparities in financing of this calibre, that does not happen in any currency zone in the world," Rajoy told reporters.
"It is impossible, so it is important that this matter is resolved."
Spain has been already granted a loan of up to €100 billion ($123 billion) for banks laden down with toxic assets following the bursting of a real estate bubble in 2008. Progress on EU banking and fiscal unity could help it get that money passed straight to the banks soon and not form part of its already heavy sovereign debt burden.
Greece, Ireland, Portugal and Cyprus have already sought bailouts but a Spanish sovereign rescue package would seriously test the European Union's coffers as it is the fourth largest economy of the 17 nations using the single euro currency.
But some analysts think it's only a matter of time.
"It looks quite clear that we are finally going to need some kind of aid," said Tomas Gallo, director of ATL Capital Investment Company in Madrid.
"The tug-o-war is that we want it be given to us without asking specifically for it, and those who will give it to us want us to ask for it, for us to compromise, to follow some measures, a commitment that we have still not acquired. But this will finally happen," he said.
In its favour, the country has already managed to place 72 per cent of its targeted €86 billion ($106 billion) in medium- and long-term debt for this year. It has minor T-bill auctions Aug. 21 and Aug. 24 while its next bond sale is not until Sept. 6.
The Treasury, however, must pay €53 billion ($65 billion) in bond redemptions before the end of the year, including a stiff €27 billion ($33 billion) in October.
Spain is in its second recession in three years with an unemployment rate of nearly 25 per cent.
But many of its 17 regional governments are now starting to run out of money while austerity measures and labour reforms brought in to try to calm financial markets and appease EU partners are stifling the economy.
Strikes and protests have become almost a daily feature. On Friday, some 500 trains were cancelled as rail workers staged a one-day strike to protest a proposed restructuring of the sector. The stoppage came at the beginning of one of Spain's biggest holiday months.
Alicia Lopez in Madrid and Barry Hatton in Lisbon contributed to this story.