First minister announces budget deal

Extra cash planned for NHS and councils

- By CHRIS HAINES ICNN Senedd Reporter

THE Labour Welsh Government has struck a £300m deal with Plaid Cymru to pass its £27bn spending plans for next year, with additional money for the NHS and councils.

The budget agreement will allow the Welsh Government's final budget for 2026/27 to pass through the Senedd in January, averting a potential crisis for public finances.

Labour cannot pass a budget on its own because the party is two votes short of a majority after Plaid Cymru won the Caerphilly by-election.

Since the draft budget was published, councils have warned of a £400m funding gap and experts suggested the NHS faced a “historically low” funding settlement.

Without a deal, the picture would have been far worse - with the Welsh budget automatically reverting to 75% of last year's, rising to 95%, costing public services billions of pounds.