The Welsh Government has unveiled details of the £27bn draft budget as ministers face a significant political test to get the spending plans passed by the Senedd.

Finance secretary Mark Drakeford provided an update on the 2026/27 draft budget, which includes an extra £800m, setting out line-by-line allocations for public services.

The former first minister has brought forward a “roll-over” draft budget, broadly rising by about 2% in line with inflation, in an effort to cut a deal with opposition parties.

Last year’s spending plans were narrowly agreed after ministers struck a deal with Jane Dodds, the leader of the Liberal Democrats in Wales and the party’s sole Senedd member.

But, following Labour’s defeat in the Caerphilly Senedd by-election on 23 October, the Welsh Government needs the support of at least one other Senedd member this year.

Failure to pass the budget by April would result in spending plans automatically reverting to 75% of last year’s – rising to 95% if still not agreed by July. Prof Drakeford has warned such a scenario could cost Wales up to £7bn, leading to thousands of job losses.

Ministers have been in talks with the Conservatives over a deal, with the Tories demanding the scrapping of land transaction tax on people’s primary homes. Binning Wales’ equivalent of stamp duty on property purchases would cost about £200m, experts estimate.

Plaid Cymru has helped ministers pass budgets in previous years, but a deal between the two collapsed in 2024 and the party would be loath to lend its support with an election on the horizon.

The Welsh Government has left around £380m unallocated in the draft budget but the actual wiggle room for political negotiations is thought to be far lower.

Prof Drakeford will step down at May’s Senedd election, having been involved in every budget for a decade and been at the heart of Welsh politics for a quarter of a century.

In his foreword, the first minister-turned-finance secretary reiterated: “We have a shared responsibility, as a Senedd, to pass a budget for Wales. My door is firmly open to working with those who believe a more ambitious budget could be agreed.”

Published today (3 November), the detailed draft budget for the 12 months from April includes £800m more than last year – with spending totalling £27.13bn.

Under the plans, health and social care would receive an extra £259m, bringing the total to £12.4bn – more than 55% of the Welsh Government’s resource budget.

The settlement for councils would rise by an average of 2.5%, with a “funding floor” to ensure no local authority receives less than a 2.3% increase. The draft local government settlement is expected to be published later this month.

The budget also includes £1.5m to extend the £1 bus fare pilot to cover five- to 15-year-olds.

But, according to budget documents, the Welsh Government will work with Transport for Wales to target £58m in “efficiency savings” on rail and bus spending.

The detailed draft budget sets out the amount of day-to-day revenue and longer-term capital funding available to other arm’s-length bodies, including the Arts Council and Sport Wales.

The Welsh Government has returned to a two-stage budget-setting process this year, with an outline published on 14 October followed by much of the finer detail today.

In previous years, the budget would be published in December, leaving less time for scrutiny.

Alongside the detailed draft budget, the Welsh Government published its £3.3bn 2026/27 infrastructure plan – with housing, health and transport topping the list of priorities.

The Welsh Government also published an impact assessment, admitting the budget as drafted could disproportionately impact disabled people, women and low-income families.

Chancellor Rachel Reeves will deliver the UK autumn budget, which will have implications for Wales, on 26 November.

The final Welsh budget will then be published on 20 January, with a key debate and vote penciled in for 27 January.

Responding to the Welsh Government's draft budget, Laura Doel, national secretary at school leaders’ union NAHT Cymru, said: “This Budget will do nothing to rescue schools across Wales which are at crisis point when it comes to funding.

“Local authorities are predicting a £137m budget shortfall for schools in 2026/27 which is an unthinkable situation when we know that this comes on the back of significant cuts to school budgets, redundancies and scaling back on frontline delivery of education.

"This announcement does not show any significant increase for local government where schools get their core funding from, and the small additions for ALN (additional learning needs) and improving attainment levels are just a drop in the ocean.

“This government cannot sit back and do nothing for fear of not being able to pass a progressive budget without a Labour majority.

"We urge all political parties in the Senedd to put aside electioneering for the time being, respond to the Finance Minister Mark Drakeford’s willingness to work together and for everyone to do what they were elected to do and put the people of Wales before politics. Any party that uses this opportunity to score points should be ashamed.

“There is a significant amount of unallocated funding sitting there which could be used to support vital frontline services like schools. Instead, there is a real risk this could be frittered away as part of any deal to get this Budget passed.

“We urge all parties to support some of the ‘consequential’ funding for education Wales was entitled to under the Barnett Formula following last year’s UK Budget being allocated to schools – there is no evidence this has happened so far.

“Let us be clear, schools in Wales are struggling, teachers and teaching assistants are being made redundant, secondary schools are offering fewer subjects to reduce staffing costs and our most vulnerable learners are not getting the support they need through the new ALN system.

“We urge all Senedd members to listen to the plight of schools and act now.”