Cutting NHS waiting times likely to top Welsh spending plans in Budget

More money to cut NHS waiting times here in Wales is likely to be at the top of Welsh Government spending plans for the coming financial year.

The Finance Secretary Mark Drakeford will set out the Labour government’s Draft Budget for 2025-6 in the Senedd on Tuesday 10 December, with a bigger pot of money available than ever before.

In the UK Government’s recent budget, the Chancellor said there would be an extra £1.7bn for the Welsh Government. Some of that was for the current financial year, but Mr Drakeford will have at least an extra £1bn to spend, bringing the total Welsh Government budget to around £24bn.

Those who run public services hope it’ll mean a reversal of the tight budgets and cuts of recent years.

But rising costs and pay rises will eat into much of the new money and the plans may run into political trouble: Labour doesn’t have a majority of votes in the Senedd and opposition parties may be unwilling to reach a deal to help the budget pass.

Since becoming First Minister, Eluned Morgan has repeatedly said that she is focussing on four priorities and those areas will almost certainly see the bulk of any new spending increases.

She says she wants to cut waiting times in the NHS, create ‘green jobs’, boost standards in schools and colleges, provide more low-rent homes and transform transport links here in Wales.

You can expect spending decisions to be in those areas, particularly more money for the NHS and schools but there are other demands.

Business rates relief?

Will the Finance Secretary choose to meet concerns from businesses in the retail, hospitality and leisure sectors about the business rates system.

It’s the Welsh Government’s responsibility here in Wales where business rates are known as ‘non-domestic rates.’

For the current financial year businesses in the retail, hospitality and leisure sectors have been able to claim 40% relief, a reduction from the covid-era 75%.

Their counterparts in England have continued to enjoy 75% relief although the Chancellor Rachel Reeves announced that that would be reduced to 40% from April 2025.

Organisations such as the Federation of Small Businesses and the trade body UK Hospitality Cymru have urged the Welsh Government to extend business rate relief in the Draft Budget and keep the level at least at 40%.

Farming

Welsh Labour’s conference in Llandudno in November saw a large number of farmers park their tractors on the prom to protest outside Venue Cymru.

Their main concern was about changes to Inheritance Tax announced by the Chancellor, which is something out of the control of Eluned Morgan’s Welsh Government.

But previous protests at the conference and in Cardiff Bay were directed at Labour’s proposed Sustainable Farming Scheme, particularly a requirement to devote 10% of agricultural land to tree cover in order to qualify for payments.

The farming unions, NFU Cymru and the FUW, both say they wants the current Basic Payment Scheme to be kept at the same level for the coming financial year and for the rural affairs budget to be restored to the level it was at before it was cut by 13% in 2023.

Flooding

The impact of Storm Bert in November brought renewed focus to the need for adequate flood defences and warning systems.

In the wake of the most recent flooding, Eluned Morgan has highlighted the £300m that she says has been spent on flood defences since 2020, meaning that hundreds rather than thousands of homes and businesses were flooded this time around.

But she acknowledged that more needs to be done and the draft budget could prove the opportunity to announce more funding for defences.

There will be an expectation too of funding for coal tip safety, after the announcement of £25m from the UK Government and action in the form of a Coal Tip Safety Bill unveiled this week.

But the total cost is estimated at £600m over 10-15 years. Campaigners will be looking for details in the draft budget.

Political problems

The Welsh Government will publish its Draft Budget today (Tuesday 10th December) and it will be debated in the Senedd chamber.

There won’t be a vote at this stage. Instead the proposals are scrutinised by the different Senedd committees.

There’ll be another debate in the chamber at the beginning of February; the Final Budget will be published at the end of February and the plans will be debated and voted on by MSs on the 4th March.

The Welsh Government needs a majority of votes in the Senedd to pass its budget but it only has exactly half the seats. It needs at least one other MS to vote for it or abstain.

Failing to pass the budget will have serious consequences. If there’s no majority by the end of the process, 75% of current spending plans continue into the new year.

It could affect the amount available too, preventing the extra money earmarked for Wales by the UK Government from being spent and reducing the tax yield in Wales by up to £3bn - a potential windfall for Welsh taxpayers but a big cut for public services.

If the process reaches this point, the Senedd will be in a period of political crisis. Failure to pass a budget is usually seen as failure of a government to gain the confidence of a parliament and could well force Eluned Morgan to resign.

All of which explains why she is looking to reach a deal with another party or parties. The lone Liberal Democrat MS is one target; Plaid Cymru is another.

The Conservatives are unlikely to reach a deal with Labour but the other two parties will be holding out for a significant concession. They’ve both been publicly very critical of the Labour Welsh Government and it’s not yet clear if either will be won over.

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