Support quality, independent, local journalism…that matters

From just £1 a month you can help fund our work – and use our website without adverts. Become a member today

Wales is up against the “toughest financial situation we have faced since devolution,” First Minister Mark Drakeford has warned.

In a statement issued to Senedd Members, Mr Drakeford said: “We are in this position because of the record levels of inflation we have experienced post-pandemic; because of the mis-management of the economy and public finances by successive UK governments over the last 13 years and because of unfunded commitments made by the UK Government, particularly in relation to public sector pay”.

The First Minister said the Welsh Government’s cabinet met on August 1 to discuss the “significant financial pressures” being faced in the 2023/24 budget and to “continue preparations for the 2024/25 budget”.

He said his cabinet will be “working over the summer to mitigate these budgetary pressures based on our principles, which include protecting frontline public services, as far as possible, and targeting support towards those at greatest need”.

He continued: “A further update will be provided to the Senedd once this work has been completed.”

Explaining the impact of the financial pressures, Mr Drakeford said: “When we made our budget for 2023/24, we drew on all our available resources to protect frontline services and provide targeted cost-of-living support to individuals and the economy.

“But even after doing all that, our financial position after the UK Spring Budget in March, was up to £900m lower in real terms than when that budget was set by the UK Government at the time of the last spending review in 2021.”

“A national conversation has never been more pressing”

Nesta Lloyd-Jones, assistant director of the Welsh NHS Confederation, said: “NHS leaders welcome the Welsh Government’s honesty regarding the unprecedented state of public finances.”

Ms Lloyd-Jones spoke of the “considerable cost pressures” currently facing NHS organisations in Wales and said: “Between the pandemic, rising energy costs, the increased cost of staff recruitment and retention and record levels of demand on services, NHS finances have been significantly impacted.”

She explained NHS leaders “are already making difficult decisions about spending priorities” and warned that “decisions made now could have a long-term impact on the health and wellbeing of the population”.

Ms Lloyd-Jones added: “A national conversation has never been more pressing. We’re calling for an open and honest conversation with the public about what the future health and care service looks like to ensure the sustainability of health and care in Wales.”

“At the mercy of Westminster”

Plaid Cymru Senedd Member Peredur Owen Griffiths, who represents the South Wales East region, said: “The Welsh Government would be in a stronger position if they stopped defending the unjust devolution settlement which leaves Wales with so little control over how we raise and spend money.

“Without the economic and fiscal levers, Wales will always be at the mercy of Westminster.”

Meanwhile, Conservative MS Natasha Asghar, who also represents South Wales East, lashed out at the Welsh Government for “wasting millions on vanity projects like 20mph speed limits, Cardiff Airport and expanding the Senedd”.