‘Urgent changes’ needed to draft budget

The Welsh government’s draft budget is “riddled with empty words”, according to a group of Senedd Members.

The Senedd’s finance committee said “urgent changes” were needed to the spending plans and the cost of living crisis should be a “higher priority”.

The Senedd will vote on the spending plans on Tuesday, ahead of a final vote in March.

The Welsh government said it would consider the committee’s recommendations.

Finance Secretary Mark Drakeford published his draft £26bn budget in December.

Under the proposals, all government departments would see a funding increase in 2025-26, in stark contrast to the 2024-25 budget which imposed cuts on all departments apart from health.

The new budget benefits from increased funding from the new Labour government in Westminster.

Announcing the plans, Drakeford said the budget “provides us with optimism about a brighter future”.

However, according to the Senedd’s finance committee which has been scrutinising the plans, it was “unclear whether the measures proposed match up to that rhetoric”.

“Today’s report outlines serious concerns about the proposed budget and provides clear recommendations for the Welsh government to consider,” said the committee’s chair, Peredur Owen Griffiths.

“If the upcoming budget is meant to signal a new start and a break from austerity, unfortunately there’s quite some work still to do.”

The report claimed the cost of living crisis had “become entrenched in the daily lives of many across Wales” and the Welsh government was “pivoting away from providing acute cost of living support”.

“We know that the cost of living challenges that many people face haven’t gone away and our message to the Welsh government is clear: now is not the time to be cutting back on supporting vulnerable people,” Owen Griffiths said.

The report, which makes 39 recommendations, was backed by all four members of the committee including both Labour MSs.

It called for more money to be spent on preventative measures to tackle poverty and health issues, accusing the government of being “more focused on firefighting issues… at the expense of longer term, strategic budgeting”.

The committee also raised concerns around the upcoming hike in National Insurance contributions to be paid by employers – an announcement made in the Chancellor’s budget in Westminster.

The UK government has promised the Welsh government money to cover the extra cost for public sector employers in Wales, but it still is not known how much would be made available or if it would stretch to cover the increased bills for third sector organisations that provide services to the public sector.

Drakeford said he did not expect to know how much money he would get from Westminster until “May or June”, however the committee called for an update “as a matter of urgency”.

Without a majority in the Senedd, Labour would need to strike a deal with another party to get the budget through.

While Tuesday’s vote would not have any binding consequences, a defeat for the government would highlight the pressure it was under ahead of the final crucial vote in March.

A Welsh government spokesperson said: “We will carefully consider the finance committee’s report ahead of our proposed final budget, which will be laid later in February.”