THE WELSH GOVERNMENT’S £26 billion budget has been narrowly approved by the Senedd after securing a crucial abstention from Liberal Democrat MS Jane Dodds. The budget, which funds the NHS, education, and other public services, passed with 29 votes in favour, 28 against, and one abstention on Tuesday evening.

Labour, which holds exactly half of the 60 seats in the Senedd, needed support from at least one opposition member. In exchange for her abstention, Dodds secured a £1 bus fare scheme for under-21s and a commitment to ban greyhound racing in Wales.

High stakes and last-minute deal

Had the budget been rejected, the Welsh Government could have faced an automatic funding cut of up to £4.15 billion, a risk that Labour ministers used to pressure opposition members into negotiations. The Welsh Government’s funding comes mostly from the UK Treasury, and without an agreed budget, vital services could have been at risk.

Labour’s Finance Secretary Mark Drakeford defended the budget as a turning point, stating: “Today, with this budget, we turned the corner—moving beyond austerity towards investment and growth.” He warned that rejecting it would mean losing extra NHS funding, school investments, and childcare support.

Where the money is going

The budget includes:

• £600 million extra for the NHS, aimed at reducing waiting times.
• £100 million for education, including childcare and school funding.
• £81 million for social housing, to tackle homelessness.
• A £15 million pilot scheme to allow 16 to 21-year-olds to travel anywhere in Wales for £1 per journey.

The Welsh Government claims that changes in UK Labour Chancellor Rachel Reeves’ spending decisions have resulted in an additional £1.5 billion for Wales. However, there are concerns that rising National Insurance contributions for public sector employers could swallow up a significant portion of this funding.

Opposition backlash

Both Plaid Cymru and the Welsh Conservatives opposed the budget, arguing it fails to address Wales’ long-term challenges.

Plaid Cymru leader Rhun ap Iorwerth dismissed Drakeford’s claims, stating: “This is a flawed Labour budget. Services will continue to be cut, some will disappear entirely, and council tax will rise significantly.”

Conservative Senedd leader Darren Millar argued that rejecting the budget would have been “a good thing”, stating: “If Labour had lost this vote, it would have ended 26 years of tired, clapped-out government that has failed Wales.”

Tensions over failed negotiations

A war of words broke out between Drakeford and Plaid Cymru, with both sides accusing the other of failing to negotiate properly.

Drakeford claimed Plaid did not return to the table after three meetings, while ap Iorwerth insisted Drakeford made no effort to secure a deal.

Plaid’s Heledd Fychan added that the budget “falls short of adequately addressing the challenges Wales faces.” She argued that people would still struggle with rising poverty, food insecurity, and heating costs.

Lib Dems claim victory, Reform UK criticises

Jane Dodds defended her role in securing key concessions, saying: “Today, I feel a deep sense of responsibility. This budget is crucial, not just for the progress we’ve made, but for securing vital funding.”

Meanwhile, Reform UK, which hopes to gain its first Senedd seats in 2026, said the budget “did nothing to fix our struggling economy, failing public services, or the cost-of-living crisis.”

With the budget now passed, the Welsh Government will begin rolling out its funding plans, but opposition parties warn that the financial pressures facing Wales are far from over.