The NHS and frontline council-run services, including schools and social care, are at the heart of the Welsh Governments 2024-2025 draft Budget.

An additional £450 million will be allocated to the NHS, and the core local government settlement will see a 3.1% increase. Nevertheless, despite this supplementary funding, health boards and councils are expected to confront a challenging year ahead.

Wales's 22 local authorities will find out their individual settlements today as The Welsh Local Government Association said councils faced a shortfall of £432m.

Speaking as she published the Welsh Government’s spending plans for 2024-2025, the Finance Minister said that Welsh Ministers had faced the “most stark and painful budget choices for Wales in the devolution era” as they developed the draft Budget.

As a result of persistently high inflation, Wales’ overall budget is worth £1.3 billion less in real terms than when it was set in 2021; and the settlement, which largely comes from the UK government in the form of a block grant, is not sufficient enough to respond to the extreme pressures that public services, businesses and people are facing.

The additional funding for the NHS in 2024-2025 comes on top of the additional £425 million which was announced in October for the remainder of this financial year, and which was baselined into the budget for the future. This means that Health will receive more than a 4% increase for 2024-2025, compared to less than 1% in England.

The core local government settlement, which along with local council tax, funds services including schools, social services and social care, bin collections and local leisure facilities, will also be protected, with a 3.1% increase.

The draft Budget has been reshaped in line with the Welsh Government’s principles and values, which include protecting core frontline services, wherever possible; delivering the greatest benefit to hardest hit households; and prioritising jobs wherever possible.

The Welsh Government will continue to provide support to people hardest hit by the cost-of-living crisis, including through the Council Tax Reduction Scheme and a £384 million package of support for non-domestic ratepayers, which includes a fifth successive year of relief for retail leisure and hospitality businesses.

A new £20 million Future Proofing Fund will be introduced in early 2024-2025 for businesses.

The Finance Minister also said the government will be carefully examining whether charges for some services – such as NHS dental care, university tuition fees and domiciliary care – need to be raised to help raise extra funding for public services and higher education, in light of the current budget situation.