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Thursday, October 15, 2026

When will reality bite in Wales?

Plaid Cymru have finally done a deal with Labour to get their supplementary budget through the Senedd. As Nation Cymru report, all it took was for them to allocate an extra £60 million for additional learning needs. 

However, Cardiff University academics Ed Gareth Poole and Owain Cynfab believe that the deal is just a stopgap that leaves wider pressures on Welsh public services unresolved.
 
Nobody expected Welsh finances to be sorted by a supplementary budget of course. Its purpose is to just move money around in year, pulling some from reserves, from additional Barnett allocations and reprioritising spending to meet the expectations of the new government. 

But the analysis, published by Wales Fiscal Analysis at the university’s Wales Governance Centre, warns of far more difficult decisions ahead.

Ed Gareth Poole and Owain Cynfab for example, calculate that core NHS spending will fall by roughly 0.4% in real terms this year, despite an additional £100 million for waiting times and elective care and predict rising costs across public services that will make Plaid's uncosted commitment to expand childcare that much harder to achieve.

They note that Additional Learning Needs (ALN) spending is heading towards £1 billion a year and, according to ministers, has grown 2.5 times faster than overall education spending over the past decade.

The news site quote Poole and Cynfab as warning that the energy price shock linked to the conflict in Iran is increasing the cost of pay, services and infrastructure.

It adds that for Wales, much will depend on whether Chancellor John Healey compensates English departments for those pressures in his forthcoming budget, but he has his own problems namely £35bn worth of spending pressures.

All the indications are that Welsh budgets will struggle to keep up with inflation over the next few years, meaning that the new Finance Minister will be firefighting to keep the show on the road while struggling to meet her election promises.

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