The next item is a statement by the Cabinet Secretary for Finance and Local Government on the draft budget for 2017-18. I call on the Cabinet Secretary, Mark Drakeford.

Thank you very much, Llywydd, for the opportunity to make a statement on the Welsh Government’s draft budget for 2017-18. I have laid the budget before the National Assembly this afternoon for consultation and scrutiny.

We live in a most uncertain period. After very careful consideration over the summer, I have decided that, in advance of the fiscal resetting promised by the Chancellor in the forthcoming November statement, it is only possible to place a one-year revenue budget before the National Assembly. A similar conclusion has been reached by finance Ministers in the Scottish Government and the Northern Ireland Executive. Against this difficult background, my aim has been to lay a budget which provides stability for our core public services over the next 18 months. But it is also a budget with ambition, a budget which makes progress on our programme for government and our promises to the people of Wales.

The budget before you today, Llywydd, is also the product of an agreement between the Government and Plaid Cymru. I wish to thank Adam Price and his team for the careful, constructive and detailed discussions which form the foundation of our agreement. It provides for a package of additional spending commitments, in addition to non-fiscal measures. These can be seen in the budget documentation available to Members. We have also agreed a forward work programme for the finance liaison committee for the next 12 months, and I look forward to embarking on these discussions.

Lywydd, gadewch i mi ddweud ychydig mwy am y cyd-destun y crëwyd y gyllideb hon oddi mewn iddo. Ers 2010-11, rydym wedi dioddef toriadau olynol i gyllideb Cymru. Erbyn diwedd y degawd, bydd ein cyllideb gyffredinol wedi gostwng 9 y cant mewn termau real—sy’n cyfateb i bron i £1.5 biliwn yn llai ar gyfer gwasanaethau cyhoeddus hanfodol yma yng Nghymru. Ac, wrth gwrs, rwyf unwaith eto yn ailddatgan heddiw yr achos macro-economaidd brys am roi'r gorau i'r polisïau cyni hunanorchfygol. O ganlyniad i’r polisïau hynny mae bygythiadau o doriadau pellach i ddod yn parhau, gan nad yw Llywodraeth y DU wedi cyhoeddi hyd yn hyn sut y bydd yn dod o hyd i'r £3.5 biliwn o ostyngiadau adrannol a gyhoeddwyd yn y gyllideb ym mis Mawrth. Gallai hyn ar ei ben ei hun olygu toriad arall o £150 miliwn ar gyfer gwasanaethau yng Nghymru. Daeth y Sefydliad Astudiaethau Cyllid i’r casgliad yn ddiweddar bod Cymru yn wynebu 11 neu fwy o flynyddoedd o gwtogi eithriadol mewn gwariant gwasanaeth cyhoeddus.

Nawr, er gwaethaf hyn, ac effeithiau uniongyrchol refferendwm yr UE ar Gymru, bydd y gyllideb sydd gerbron yr Aelodau heddiw yn: buddsoddi £240 miliwn ychwanegol yn y GIG yng Nghymru i fodloni’r twf parhaus mewn galw ac mewn costau gwasanaethau; bydd hyn yn sicrhau £111 miliwn ar gyfer prentisiaethau a Hyfforddeiaethau yn rhan o'n hymrwymiad i fuddsoddi mewn sgiliau a swyddi yng Nghymru, gan gynnwys £88.3 miliwn i greu 100,000 o brentisiaethau i bob oed; bydd yn cyflwyno toriad mewn treth o £100 miliwn i fusnesau bach; yn darparu’r setliad cyllido llywodraeth leol gorau ers blynyddoedd; yn cadarnhau ein buddsoddiad yn y gronfa gofal canolraddol; yn codi safonau ysgolion drwy fuddsoddiad o £20 miliwn y flwyddyn nesaf; yn diogelu ac yn cynyddu cyllid ar gyfer y grant amddifadedd disgyblion; yn galluogi bwrw ymlaen â'r gwaith o ddatblygu cynnig gofal plant mwyaf hael y DU ar gyfer rhieni sy'n gweithio. Ac, yn ychwanegol at y £240 miliwn a nodwyd eisoes, byddwn hefyd yn darparu £16 miliwn y flwyddyn nesaf er mwyn i’r GIG allu sefydlu cronfa driniaeth newydd, a fydd yn sicrhau bod triniaethau newydd ac arloesol ar gael ar gyfer clefydau sy'n bygwth bywydau ac yn newid bywydau i’r holl bobl sydd eu hangen yng Nghymru. Byddwn hefyd yn dyrannu £4.5 miliwn i godi'r terfyn cyfalaf fel y gall pobl gadw mwy o'u cynilion bywyd wrth fynd i ofal preswyl, fel yr addawyd ym maniffesto fy mhlaid.

Mae ein cytundeb â Phlaid Cymru yn golygu y bydd buddsoddiadau ychwanegol pellach ar gyfer gwasanaethau iechyd—£1 miliwn ar gyfer gwasanaethau gofal diwedd oes, gwerth £1 miliwn ar gyfer anhwylderau bwyta a gwasanaethau trawsryweddol, a £7 miliwn yn ychwanegol at yr hyn sydd eisoes yn y gyllideb er mwyn buddsoddi rhagor mewn hyfforddi gweithwyr gofal iechyd proffesiynol ychwanegol.

Lywydd, er mai cyllideb refeniw am un flwyddyn yn unig yr oedd yn ddoeth ei gosod, rwyf wedi penderfynu ei bod yn bosibl nodi cynllun cyfalaf dros bedair blynedd. Bydd neilltuo’r rhan fwyaf o'r cyfalaf sydd ar gael yn rhoi hyder a sicrwydd i'r sector adeiladu, busnesau a buddsoddwyr, ac yn cefnogi pobl i wneud y penderfyniadau gorau. Byddwn yn darparu dros £1.3 biliwn dros y pedair blynedd nesaf i ddarparu 20,000 o gartrefi fforddiadwy ychwanegol yma yng Nghymru yn unol â'r ymrwymiad yn ein maniffesto. Byddwn yn buddsoddi mwy na £500 miliwn o gyfalaf confensiynol yn ein rhaglen ysgolion yr unfed ganrif ar hugain gwerth £2 biliwn, ac yn defnyddio modelau cyllid arloesol newydd i fwrw ymlaen â'r gwaith o ddatblygu’r Ganolfan Ganser Felindre arbenigol newydd, yn ogystal â deuoli'r A465.

Mae'r cyllid cyfalaf wedi cael ei neilltuo mewn cronfeydd wrth gefn i ddarparu ffordd liniaru newydd yr M4 erbyn 2021, yn amodol ar ganlyniad yr ymchwiliad cyhoeddus y flwyddyn nesaf. Mae bron i £370 miliwn yn y gyllideb gyfalaf dros y pedair blynedd nesaf i gyflawni ein cynlluniau uchelgeisiol ar gyfer metro de Cymru, ac rydym yn buddsoddi i ddatblygu cynigion metro ar gyfer y gogledd hefyd. Bydd pymtheg miliwn o bunnoedd yn y rhaglen gyfalaf iechyd ar gyfer 2017-18 yn cael ei fuddsoddi i wella diagnosteg, fel yr adlewyrchir yn ein cytundeb cyllideb â Phlaid Cymru.

Lywydd, mae’r datganiad hwn wedi canolbwyntio ar gynlluniau’r gyllideb ar gyfer y dyfodol, ond rydym hefyd yn gwybod bod pwysau gwirioneddol ar rai o'n gwasanaethau craidd yn y flwyddyn ariannol gyfredol. Rwy'n disgwyl gallu nodi rhai o'r pwysau yn ystod y flwyddyn hynny. Fodd bynnag, bydd angen cydbwyso ein hymateb i'r materion hynny â'r hyn y bydd datganiad yr hydref y Canghellor yn ei olygu i Gymru. Byddaf, wrth gwrs, yn rhoi'r wybodaeth ddiweddaraf i'r Aelodau am y cynlluniau hyn wrth iddynt ddatblygu.

Felly, Lywydd, cyllideb ar gyfer sefydlogrwydd ac uchelgais yw hon. Mae'n buddsoddi ar gyfer heddiw ac yn paratoi ar gyfer yfory. Bydd yn ein helpu i symud ein GIG ymlaen, i godi safonau ysgolion, i weithredu'r pecyn diwygio addysg mwyaf y mae Cymru wedi’i weld ers y 1940au, a bydd yn sicrhau y gall ein partneriaid llywodraeth leol barhau i ddarparu eu gwasanaethau hanfodol. Mae hon hefyd, Lywydd, yn gyllideb ar gyfer uchelgais, buddsoddi yng Nghymru, mewn seilwaith hanfodol newydd, mewn tai, mewn trafnidiaeth, mewn swyddi ac yn ein ffyniant yn y dyfodol. Mae'n gyllideb sy'n symud Cymru yn ei blaen.

Can I thank the Cabinet Secretary for his statement today and for his phone call earlier, giving me advance notice of the headline figures in today’s draft budget? I understand his logic in laying a one-year revenue budget and a four-year capital budget, but I’m sure it won’t surprise the Cabinet Secretary that we on this side of the Chamber cannot support this draft budget in its current form. Once again, Plaid Cymru have fallen over themselves to do a deal with the Welsh Government and prop them up regardless. Whilst there are some announcements that are to be welcomed in this statement, communities across Wales have still been left behind.

Of course, it is my earnest wish that this draft budget will deliver for Welsh communities where so many others before it have failed, but you will forgive me if I reserve some scepticism, given that outcomes in so many areas of public life are still badly wanting. As we enter into the next phase of the fifth Assembly, our nation remains in the chokehold of an underperforming economy, which sees families in Wales take home the lowest wages in Britain—this according to the Welsh Government’s own statistical analysis. Last week, an EU regional social progress index study placed Wales’s education system at the bottom of the UK league table—not the first study to do so. Public health, too, remains a major concern. The Welsh health survey highlighted that obesity levels are rising and diabetes prevalence has more than doubled since 1996. These issues stubbornly endure.

Going forward, it’s crucial that every pound spent by the Welsh Government is spent effectively, ensuring value for money for the Welsh taxpayer and a renewed focus on outcomes. No-one denies that we have been through tough economic times and the UK Government has had to take tough economic decisions to get the economy back on track. Of course, at the same time, the referendum vote to leave the EU raises a whole series of questions over future budget planning. Therefore, can the Cabinet Secretary tell us what impact the EU referendum result has had on the Welsh Government’s budget planning processes for the fifth Assembly and what work the Welsh Government has done since the referendum result in terms of its budget processes and economic forecasting ahead of Britain’s withdrawal from the European Union?

Now, turning to some of the headline figures from today’s announcement, of course, I welcome the additional money that has been allocated to the health budget, and I sincerely hope that this will go some way to addressing the real issues that our NHS faces. The Cabinet Secretary will remember from his time as health Minister the struggle of delivering health services in rural parts of Wales, and so perhaps the Cabinet Secretary will tell us how today’s budget will roll back the centralisation of services that we’ve seen in recent years and fill in the gaps in provision that there are in parts of west, mid and, indeed, north Wales. Indeed, can the Cabinet Secretary confirm for the record this afternoon that, in light of the numerous reports criticising Welsh NHS finances, he is now fully confident that this draft budget is affordable and that it will sufficiently support the NHS in Wales?

As we know, there are higher costs to delivering public services in rural areas, and so it’s important that these areas are adequately prioritised in any Welsh Government budget. I understand local government will receive a cash-flat settlement in this draft budget, however, can the Minister indicate to us today how this money will be allocated to local authorities and whether rural authorities will be prioritised, given that they have suffered some substantial cuts in the past? An acknowledgement of the challenges that rural authorities face must be made in this budget, and I hope the Cabinet Secretary will provide more detail on how this budget will specifically address the challenges that rural local authorities face.

Today’s statement includes an extra £30 million for higher and further education, which is certainly welcome. I’m sure all Members in this Chamber want to see a strong Welsh education system that is sustainable for the future. Now, I appreciate that £30 million cannot possibly be the answer to all of Wales’s problems when it comes to higher education and further education, but this funding could actually make a difference. Therefore, can the Cabinet Secretary confirm what new proposals will be implemented with this additional funding and how this funding will be used to close the funding gap between Welsh and English higher education? In relation to further education colleges, can the Cabinet Secretary confirm how this additional funding will be allocated to colleges and what criteria the colleges will have to meet to receive any additional funding?

Llywydd, the Welsh Government must ensure that any spending through this Assembly is effective and delivers real improvements to key front-line services to the people of Wales. I was extremely disappointed, like many in this Chamber, in the Welsh Government’s programme for government, which does not provide the confidence or detail required to improve the life chances of people in communities across Wales. Therefore, can the Cabinet Secretary tell us how the Government will truly test the outcomes of any budget in this Assembly if there are no targets by which to measure them? Crucially, how can the Welsh Government ensure value for money across portfolio areas when there is very little detail in the programme for government to measure the progress of its budget? So, in closing, therefore, Llywydd, can I once again thank the Cabinet Secretary for today’s statement? My colleagues and I look forward to scrutinising the draft budget further over the next few weeks. Diolch.

Thank you to Paul Davies for his contribution. I take it for granted, really, that we share an ambition across the Assembly to make sure that the money we have available for public services is spent effectively, that it brings about real improvements in people’s lives and that we spend the money we have in the way that has the greatest impact. I look forward to the detailed scrutiny of the budget against those criteria that will follow today’s statement.

There were a series of specific questions in what Paul Davies had to ask, so I’ll try and address those, Llywydd. As far as the impact of the referendum is concerned, the Welsh Government will take a twin track to trying to respond to that. There are the immediate impacts in relation to the funding that comes from Europe to Wales, and our repeated calls on the UK Government to make sure that every penny that comes from the European Union should come to Wales have borne some fruit in the two statements made by the Chancellor of the Exchequer, providing some guarantees on that funding for Wales. I’m glad to see those and hope to see more of that in the future. The longer-term challenge for the UK Government, and then from Wales, will be on the long-term impact on the UK economy of leaving the European Union. It is quite impossible for us to make a reliable assessment of that in Wales when we have such an absence of clarity at the UK Government end on the terms on which they seek to bring about that exit. We will continue to urge them to conclude an agreement with the European Union that takes full cognisance of the interests of Wales, including full and unfettered access to the free market.

Mr Davies asked me questions about the health budget. The extra investment that we are making in the health budget in this draft budget will be sufficient to meet the Nuffield gap. It will continue our policies of shifting care from secondary to primary care, it will allow the health service to go on doing the remarkable work that has happened in Wales in recent times in increasing the share of chronic illness services that are provided outside the hospital setting—one of the reasons why the Nuffield report and its successors conclude that the health service in Wales goes on being affordable into the future, provided—and this is the really key point, Llywydd, which Members on the Conservative side will want to hear—that public services have, in future, a fair share of the growth in the economy. Local government has, in this proposed budget, for the first time in many years, no cuts at all in the cash available to it. I’m afraid that the Member will have to wait until tomorrow, when I will lay the local government proposed settlement, to see how that affects individual authorities.

I was grateful for what he said about the importance of further and higher education. The £30 million that we have been able to find additionally for HE and FE will be deployed by the Cabinet Secretary for Education, and she will do so in a way that is consistent with our ambitions for the implementation of the Diamond review.

First of all, I would like to thank the finance Secretary for his statement today and for the phone call that I received from him earlier too, but most of all, for the process of discussion that we went through over a period of months over the summer. Of course, the agreement between Plaid Cymru and the Government is testament to those mature discussions that we could use as a foundation for the statement that he has just given. Of course, there was compromise—it is an integral part of any discussion between two parties—but may I pay tribute to him for his constructive, creative, wise and considered approach to these negotiations? It is an agreement that we are very proud of in Plaid Cymru—the biggest ever deal between the Welsh Government and any opposition party: £119 million for Plaid Cymru manifesto pledges, the priorities that reflect the ambition of Plaid Cymru in terms of scope and substance, but even more importantly, ones that will lead to real improvements in the lives of people in all parts of Wales; £30 million for higher and further education, and I was pleased to see Paul Davies welcome that; £50 million for the tourism sector that we heard mention of; and an additional £5 million for the Welsh language and so on. The list is too long for me to go through it in full, but certainly it does represent an excellent deal for the people of Wales.

Mae'r cytundeb yn cyflawni llawer o'n hymrwymiadau allweddol fel plaid, a nodwyd yn y maniffesto yr oedd pob Aelod a etholwyd fel aelodau Plaid Cymru yn yr etholiad Cynulliad hwn yn ei gefnogi. Dyma’r mandad a roddwyd i ni gan gannoedd o filoedd o'n cyd-ddinasyddion. Efallai fy mod yn aralleirio rhywun sydd wedi bod yn fentor gwleidyddol i mi trwy ddweud ei bod yn bwysig bod Plaid Cymru yn gwneud defnydd llawn o'i sefyllfa bob amser i sicrhau gwelliannau gweladwy i fywydau pobl yng Nghymru. Dyna beth yw gwleidyddiaeth ddemocrataidd, yn y pen draw; nid ceisio denu clod a chwyno am fanion o’r ymylon, ond cyflawni gwelliannau gwirioneddol i bobl Cymru. Yn aml, mewn gwleidyddiaeth— [Torri ar draws.] Yn aml mewn gwleidyddiaeth, gallwn wneud mwy pan fyddwn yn gweithio ar draws ffiniau pleidiau, pan fyddwn yn edrych am y tir cyffredin hwnnw ac yn croesawu’r cyfle hwnnw i gyflawni, gyda'n gilydd, y math o newidiadau y mae pobl Cymru eu hunain yn dymuno eu gweld.

Wrth gwrs, bydd agweddau ar y gyllideb ehangach y byddwn yn anghytuno â nhw. Byddwn yn dymuno trafod a diwygio’r drafft, ac mae proses y gyllideb, wrth inni fynd drwy'r broses graffu ar lefel pwyllgor ac ar lawr y Cynulliad, yn rhoi cyfle i bob un ohonom wella’r gyllideb ddrafft. Bydd ein plaid ni, ynghyd â rhanddeiliaid eraill yn y gymdeithas ehangach yng Nghymru, yn dymuno bod yn rhan o'r ymgysylltu ehangach hwnnw hefyd.

Mae gennyf ychydig o gwestiynau i Ysgrifennydd y Cabinet, yn fyr. Mae eisoes wedi cyfeirio at ddatganiad yr hydref. Mae llefarydd cyllid y Blaid Geidwadol wedi cyfeirio at y 'tagu' yr ydym yn ei wynebu. Wel, os ydym yn sôn am arian cyhoeddus, mae'r tagu go iawn yn cael ei weithredu gan y Llywodraeth Geidwadol yn San Steffan, sydd wedi ein gadael, mewn gwirionedd, â chyni a Brexit caled; gallai fod yn gyni ysgafn, ond nid wyf yn argyhoeddedig o hynny. Dyna'r tagu. Dyna’r cyd-destun anodd yr ydym yn ei wynebu. Ond, a wnaiff Ysgrifennydd y Cabinet ddweud ychydig mwy am effeithiau gwahaniaethol posibl datganiad yr hydref o ran y cyllidebau refeniw neu gyfalaf, ac efallai rhoi rhywfaint mwy o fanylion i ni am sut y bydd y newidiadau, a allai fod angen eu rhoi ar waith o ganlyniad i ddatganiad yr hydref, yn effeithio ar ein proses o adolygu yma?

Rwy'n siŵr y bydd Ysgrifennydd y Cabinet yn cytuno mai un o nodweddion cadarnhaol ac unigryw y cytundeb hwn ar gyfer y gyllideb, gan ei fod mewn gwirionedd wedi’i ymwreiddio yn rhan o broses ehangach gyda’r pwyllgor cyswllt ar gyllid a'r compact ehangach, yw ei fod hefyd yn cynnwys blaenraglen waith y tu hwnt i gytundeb y gyllideb. Un o'r meysydd yr ydym yn awyddus i’w archwilio gyda’n gilydd yw’r maes pwysig hwn o wella effeithiolrwydd, y cyfeiriwyd ato, ac arbedion effeithlonrwydd yn y sector cyhoeddus, yn gyffredinol, sy'n gwbl hanfodol, wrth gwrs, os ydym am allu ymdrin â rhai o'r heriau ariannol a'r pwysau eraill ar wasanaethau cyhoeddus y byddwn yn eu hwynebu. Yn olaf, byddwn yn cael datganiad ar y comisiwn seilwaith cenedlaethol, felly nid wyf am ymyrryd yn ormodol yn y pwnc hwnnw. Rydym wedi gweld gostyngiad sylweddol mewn gwariant cyfalaf o'i gymharu â dechrau'r degawd hwn. Cyfeiriodd yr Ysgrifennydd Cyllid at rai o'r ffynonellau arloesol o gyllid y mae’n eu harchwilio er mwyn llenwi'r bwlch hwn, fel y gallwn barhau mewn gwirionedd i gynyddu a chyflymu’r cynnydd yn y buddsoddiad mewn seilwaith. A wnaiff ef ddweud ychydig mwy am y gwaith sy’n cael ei wneud i symud hynny ymlaen?

May I say thank you to Adam Price for his comments in introducing his questions?

Af yn syth at y cwestiynau penodol a gododd Adam Price. Mae e'n hollol iawn i dynnu sylw at y ffaith ein bod yn gorfod cyflwyno ein cyllideb gerbron y Cynulliad cyn datganiad yr hydref, pan mae’r Canghellor yn addo ailosodiad ariannol, a phan fo’n rhaid i ni wneud ein penderfyniadau heb wybod yn union sut y bydd yr ailosodiad hwnnw yn cael ei weithredu. O ganlyniad, rwyf wedi gorfod gwneud cyfres o benderfyniadau gyda chydweithwyr yn y Cabinet.

Cyn belled ag y mae’r gyllideb gyfalaf yn y cwestiwn, rwyf wedi gwneud penderfyniad, yn seiliedig ar yr hyn yr ydym yn gallu ei ddarllen o'r gwahanol ddatganiadau y mae'r Canghellor wedi eu gwneud—yn fwyaf diweddar, efallai, yn Washington—bod ganddo fwriad o beidio â lleihau buddsoddiad cyfalaf yn economi y DU ac y gallem hyd yn oed weld rhywfaint o fuddsoddiad cymhedrol—a byddai croeso i hynny—gan fanteisio ar gyfraddau llog hanesyddol isel ac yn y blaen i roi rhywfaint o hwb i wariant ar seilwaith. Am y rheswm hwnnw, rwy’n teimlo'n ffyddiog wrth gyflwyno cyllideb gyfalaf pedair blynedd.

Yr ansicrwydd ynghylch refeniw yw’r rheswm yr wyf wedi bod yn gaeth i gyllideb refeniw un flwyddyn. Pan fydd aelodau yn cael cyfle i astudio'r gyllideb yn fwy manwl, byddant yn gweld, yn y gyllideb ddrafft, fy mod yn cynnig mynd â chronfa refeniw wrth gefn uwch nag arfer i mewn i’r flwyddyn nesaf. Mae hynny yno rhag ofn i ddatganiad yr hydref leihau lefel y refeniw sydd ar gael i Lywodraeth Cymru y flwyddyn nesaf. Ac os yw pobl o’r farn bod hwn yn bosibilrwydd annhebygol, bydd Aelodau yma sy'n cofio y cafwyd, dim ond y llynedd, gwerth £50 miliwn o doriadau refeniw yn ystod y flwyddyn, y bu’n rhaid i Lywodraeth Cymru eu hymgorffori. Yr hyn yr wyf yn awyddus i’w osgoi yw gorfod ailagor y trafodaethau manwl iawn yr wyf wedi eu cael gyda chydweithwyr yn y Cabinet dros yr haf, ac, yn wir, gyda Phlaid Cymru, er mwyn gallu cyflwyno’r gyllideb hon heddiw. Os oes rhagor o doriadau i ddod i gyllideb refeniw Llywodraeth Cymru y flwyddyn nesaf, byddai'n well gennyf allu ymdrin â'r rheini drwy'r gronfa wrth gefn na thrwy ofyn i gydweithwyr ymgorffori rhagor o ostyngiadau. Os na fyddwn yn wynebu gostyngiad o'r fath y flwyddyn nesaf, yna byddaf yn ystyried gwneud rhai addasiadau pellach i'r gronfa wrth gefn honno cyn y gyllideb derfynol.

Tynnodd Adam Price sylw at y flaenraglen waith sydd wedi'i chytuno ar gyfer y pwyllgor cyswllt ar gyllid. Roeddwn i o’r farn ei bod yn rhan bwysig o'n cytundeb i allu nodi y flaenraglen waith honno. Mae rhai materion pwysig iawn a hirdymor yr ydym wedi cytuno i fynd i'r afael â nhw ar y cyd, ac edrychaf ymlaen at y cyfle i allu symud y tu hwnt i'r gwaith anochel o ymdrin â’r manylion yr ydym wedi gorfod ei wneud dros yr wythnosau diwethaf er mwyn mynd i'r afael â rhai o'r materion hynny.

Yn olaf, gofynwyd cwestiwn i mi am gyfalaf, ac mae Adam Price yn gwbl gywir i dynnu sylw at y ffaith y bydd y cyfalaf sydd ar gael i wasanaethau cyhoeddus yng Nghymru wedi gostwng gan draean rhwng 2009 a 2019, ac rydym wedi gorfod gweithio'n galed i ddod o hyd i ddulliau o bontio'r bwlch hwnnw. Mae'r gyllideb sydd gerbron yr Aelodau heddiw yn defnyddio cymaint â phosib ar y gallu benthyca newydd yr ydym wedi’i gytuno gyda Llywodraeth y DU. Mae'n adeiladu ar y gwaith a wnaed gan fy rhagflaenydd, Jane Hutt, o ran manteisio ar allu benthyca cymdeithasau tai ac awdurdodau lleol pan fyddwn yn darparu canlyniadau refeniw y benthyca hwnnw. Edrychaf ymlaen, hefyd, at ddatblygu rhagor o offerynnau ariannol er mwyn bwrw ymlaen, fel y dywedais yn fy natganiad, â’r ganolfan canser newydd yn Felindre a deuoli ffordd Blaenau'r Cymoedd yn llwyr.

The Deputy Presiding Officer (Ann Jones) took the Chair.

I thank the Cabinet Secretary for his statement and advance notice thereof, although I think I must have missed his phone call. [Laughter.] I have, though, got the copy of the budget during the First Minister's statement—[Interruption.] Oh well, never mind, never mind. I've been doing my best to at least scan-read the budget since my question at First Minister's questions, while, of course, listening at the same time, and there certainly are aspects of this budget that we would welcome, particularly the increase in health spending. I think it's about 4 per cent for health, well-being and sport as a whole, and 5.4 per cent for what the Government calls ‘core NHS services’. Could the Cabinet Secretary give a bit more clarity about this extra £240 million and then the extra £44 million I think he referred to on account of Plaid, and in particular the £20 million ring fence of mental health—welcome, albeit only one twelfth of the increase—and the £15 million in capital for diagnostics? Are both or either of those included within the £44 million?

I'd like to give a particular welcome to the extra £7 million for medical training. The £1 million end-of-life care addition is obviously welcome, but, I'm afraid, is a drop in the ocean in that area—

Why don't you give us the money from Brussels? Then we'd have enough money to pay for it.

We're looking forward to the extra money from Brussels, which will stand the Welsh Government and the UK Government in good stead in due course, once we leave.

The Plaid statement earlier we had from Adam Price—I think he said just now that ‘we will deliver together’, and I think he was quoted in the media earlier as saying that waiting times in the NHS will be reduced on account of this intervention by Plaid. Can the Cabinet Secretary advise us of the extent to which we call Plaid to account for their role in delivering this reduction in waiting times, or is that something he continues to take sole responsibility for himself and with the formal Welsh Government?

Outside the health area, where I think there are some welcome increases, we note local government is getting a 3.1 per cent increase, of which I think almost all is capital—£123 million—and I think that is welcome. However, I received at the beginning of this year a very welcome letter from Caerphilly County Borough Council telling me, actually, that they weren’t going to increase my council tax after all, because the grant settlement had been more generous than they anticipated. This year, we hear there’s another £25 million thanks to Plaid, and we are also told that, for the first year in four, there is to be an increase in the non-hypothecated grant. Can all this be afforded? I’m sure it’s very, very welcome for Labour and Plaid councillors standing for re-election next May, but given what the Cabinet Secretary says about the overall pressures, is not the risk that there will be very significant cuts following those elections, and given the relative generosity of spending settlements since austerity commenced in 2010 for Wales in the local government area, certainly compared to England? Although I’m not suggesting that we replicate the cuts there in any sense. Certainly, the social services additional funding and the integration with the NHS are welcome. But can the Minister continue to protect local government to the extent that he says in this budget?

The £30 million extra for higher education and further education—we support some of those further education additions. The higher education, we’re told, is for the transition to the new student support arrangements., which we were told were going to be cost neutral, or, the Conservative spokesman says, a saving of £48 million. Can the Minister confirm how cost neutral or otherwise these changes will be, and whether he, given his long history of progressive left-wing politics, considers that these handouts of means-tested grants to families earning between £50,000 and £81,000 is a priority for him, including also the £1,000 for families earning even higher than that? Is it possible we could seek some savings in this area given the other changes and the pressures that the Cabinet Secretary sets out in his budget?

On transport, we welcome the study into the Carmarthen-Aberystwyth route, and possibly reopening that, although for £300,000 we’re not totally sure, given the challenges, how much that’s going to lead to. But we welcome it as far as it goes. It was in our manifesto as well as in Plaid’s. We note that the Cabinet Secretary has set aside in reserves more than £900 million for an M4 relief road. Is that enough given the estimates of cost we now get for that black route? Professor Stuart Cole told me the week before last that he now thought it would be at least £1.2 billion, compared to just £0.5 billion for his blue route or £0.6 billion with the second leg up to the A449.

Finally from me, I’d just like to refer to the Severn bridges and the tolling arrangements. The St David’s Day agreement said they would be a matter for agreement between the UK and the Welsh Governments. There doesn’t seem to be much agreement, though, with this continuing tax that the UK Government is going to put on the tolls after they should be abolished in approximately a year’s time. Will that continue after the purported debt is paid off, or will the Cabinet Secretary look forward with me to something in the budget next year to make a contribution towards maintenance so that tolls on those bridges can be scrapped?

I thank Mark Reckless for those parts of the budget that he recognised as being welcome. I’ll try and address his specific questions.

In relation to the mental health funding that is part of the £240 million, the £15 million for diagnostics is part of the capital programme provided to the health main expenditure group, and, of course, as a result of that investment, waiting times for diagnostics will continue to reduce still further.

The £7 million for training is over and above the £240 million, and the £1 million for end-of-life care is certainly not to be regarded as a drop in the ocean. In terms of the hospice sector in Wales, that is a very significant investment and will be, I know, very widely welcomed by a service that is the best in the whole of the United Kingdom.

As far as local government is concerned, I’m very glad to have been able to provide a no-cash-cut budget to local government this year, but let me say what I’ve said to local government already: tougher times and harder choices lie ahead. The budget that we are promised from the UK Government goes on cutting the resources available to this place, year after year after year. There is nowhere that anyone can simply melt those pressures away. They are inevitably bound to have an impact on our delivery partners. I was keen to provide an 18-month period of stability for those key services, and they need to use that time to prepare for the choices that lie ahead.

As far as education is concerned, I’m very happy to provide a copy of my leaflet on progressive universalism—[Laughter.]—which I’m sure the Member would enjoy. It is very important that we continue to provide services in which all our citizens have a stake. That’s how you get the best services. His party’s insistence on means testing would simply go back to that very old adage that services that are reserved for poor people very quickly become poor services. The reason why services continue to be of the standard they are in a civilised society is that we make sure that everybody—the well informed as well as those who struggle, the articulate as well as the inarticulate—has a stake in making those services as good as possible. That’s the sort of education service that we want to see here in Wales.

As far as the M4 relief road is concerned, I have very carefully designed the budget so that the expenditure that the Cabinet Secretary with the responsibility needs to have next year for M4 purposes are available directly to him in his portfolio, but the rest of the expenditure for the M4 is held in reserves so that we pay proper respect to the independent public inquiry that is to be conducted. We will know, when that inquiry concludes, the level of funding that will be needed to be secured for those purposes. Thankfully, Dirprwy Lywydd, I’ve not needed to address the issue of tolls on the Severn bridges for the purposes of next year’s budget.

Thank you. I’ve got three more speakers and it’s important that they’re heard as well. So, I’m going to ask for questions without the preambles, if possible. Mike Hedges.

Thank you, Deputy Presiding Officer. Can I just say that what the Minister agreed with Plaid Cymru are a lot of issues that I would have actually been asking him for if he hadn’t?

Austerity for the Tories is a political policy not an economic one. It’s about shrinking the state. It is having a serious effect on public services. I have three questions. On health, can the Minister confirm that the health, well-being and sports budget is now over 50 per cent of managed expenditure and that it’s just under half of total resource and capital?

On local government, which is very important to the people of Wales, especially support for health—things like refuse collection, social services, leisure facilities, environmental health and housing all play a major part in keeping people healthy—the pressures on social services, both child and adult services, are immense, and, I would say, far greater than those on health. The importance of education we’ve discussed earlier. What information does the Cabinet Secretary have on pressures on local government expenditure?

The third question is—we had a statement on Communities First last week, will the Cabinet Secretary be able to tell us what is being cut from the budget in terms of provision? If Communities First is not going to exist in there, what is going to happen to some of the schemes currently being supported by Communities First? Will they exist under another form, or will they just disappear?

As ever, it is possible to do the maths in many different ways. As Mike Hedges said, the responsibilities of my colleague Vaughan Gething now include sport as well as the health service. The best estimate I have of the proportion that health spending takes in next year’s budget is that it remains below 50 per cent of this Assembly’s budget.

Of course, I recognise the pressures that there are on social services. Personally, I don’t find it the most helpful way to think about these things as being to regard health and social services as somehow in competition with one another. Our aim is to make sure that they work together to the best possible extent.

I hear of the pressures on local government absolutely regularly. As Members will know, I have visited all 22 local authorities in recent months, not a single one of them forwent the opportunity to explain to me the pressures that they face, and those messages culminate in the finances sub-group that we have here in the Welsh Government, where politicians from local government and experts come together to assess those pressures.

As far as Communities First is concerned, as Carl Sargeant made clear in his statement last week, this is not a budget-driven set of decisions. He will have decided to bring together in his portfolio a series of spending streams in a new preventative budget, which includes Communities First but also Flying Start and Families First. The policy that the Cabinet Secretary is pursuing is one of how best to use the resources that we have at our disposal, rather than how to reduce them.

May I thank the Minister for his statement and for the mature and constructive way in which he’s discussed the draft budget with my colleague Adam Price? The budget will now be out for consultation. You will first of all appear before the Finance Committee tomorrow morning to kick off this process. May I ask you, in terms of all of the committees that will look at the budget over the next few weeks, can you explain what role preventative spending will have and what influence important pieces of legislation brought forward by the previous Government, such as the Well-being of Future Generations (Wales) Act 2015 will have, and have they influenced the way in which you have allocated expenditure in this draft budget?

Two very specific questions, too, if I may, on what’s included in the budget as we currently find it: can you confirm, as the Assembly has desired, that there should be no cut in the Supporting People programme budget, and that that should remain without any cuts to its budget, as I understand it? Can you also tell us what has happened to the increase of 1 per cent that the previous Government had put in place in terms of expenditure on schools and education for those of five to 16 years of age? As I see it, that guidance has been removed from this budget. If so, is there another target for expenditure in schools that has coloured the decision in the current draft budget?

The final question: am I right to interpret your answer on the M4 as meaning that there will be no capital expenditure in this particular budget on the M4, apart from, of course, paying for the public inquiry and so on?

Thank you very much, Simon Thomas, for those questions. I look forward to the process of scrutiny. I acknowledge that Members won’t yet have had an opportunity to look through the budget narrative that I published this afternoon, but I hope that more details about the things that Simon Thomas has raised will be available there. I can say this afternoon that Supporting People will not face any cut in its budget.

Nid yw wedi bod yn bosibl diogelu’r 1 y cant, a oedd yn un o nodweddion tymor diwethaf y Cynulliad, eto yn y tymor Cynulliad hwn, ond ceir buddsoddiadau sylweddol iawn ym maes addysg. Ceir £20 miliwn ar gyfer gwella addysg yn gyffredinol yn rhan o'r ymrwymiad o £100 miliwn a wnaethom fel Llywodraeth, a bydd y cyllidebau hynny sydd yn rhan o'r grant amddifadedd disgyblion, a oedd yn rhaglen â therfyn amser iddi, yn cael eu parhau y flwyddyn nesaf. Bydd bron i £90 miliwn ar gael bellach ar gyfer y dibenion pwysig iawn hynny.

Cyn belled ag y mae’r M4 yn y cwestiwn, dim ond i ailadrodd yr hyn a ddywedais, mae’r arian y bydd ei angen ar Ysgrifennydd y Cabinet ar gyfer dibenion blwyddyn nesaf ar gael iddo drwy ei Brif Grŵp Gwariant ei hun, ond mae'r rhan fwyaf o'r gwariant a allai fod ei angen ar gyfer yr M4, yn dibynnu ar ganlyniad yr ymchwiliad cyhoeddus, yn cael ei gadw mewn cronfeydd wrth gefn i wneud yn siŵr y gellir gweld bod yr ymchwiliad hwnnw yn cael ei gynnal gyda'r annibyniaeth y mae arnom angen iddo ei gael.

Thank you. Finally, Lynne Neagle.

Thank you, Deputy Presiding Officer. Can I give a very warm welcome to this budget statement today, set as it is against the backdrop of very, very challenging economic circumstances?

I’m delighted to see so many of our programme for government commitments funded in the statement. I particularly welcome the additional money for the health service. As you know, Minister, we have not gone down the road that they have in England, where we have seen extremely harsh reductions in funding, particularly for adult social care. We’ve always taken the view in Wales that the health service and social services go hand in hand. Are you able to outline what additional funding there is in this budget for social care?

I’m also very pleased with the announcement about protecting local government funding. My own authority works extremely hard to deliver public services in very challenging circumstances. Unlike Paul Davies though, I would like a slightly different assurance on the allocation of the funding. In my experience, it is deprived authorities that often lose out under the local government formula. So, I would like to ask what steps you are going to take, and obviously we await more detail tomorrow to ensure that it is our neediest communities that receive the most protection.

Can I thank Lynne Neagle for her opening remarks? All the key commitments of this Government are reflected in this budget. That’s why it is an ambitious budget, because it sets us on the road to delivering all those key things that we put before people in Wales earlier this year. I agree with her entirely that the only sensible course of action, from the point of view of the citizen, is to regard our health and social care services as a continuum in which they get a service in the round, dealing with all the different aspects that they require, and that’s why we have gone on making sure that we invest in our social care services, at the same time as providing our health services with the investment that they need.

As a result, as well as Supporting People being protected in this budget, we will continue next year to provide the full £60 million that was invested this year in the intermediate care fund—£50 million in revenue and another £10 million in capital. And in the local authority budget, which I have set out today, there is £25 million earmarked in that budget for social services purposes, as there was £21 million earmarked for the same purposes in this year, in order to make it clear to our partners in local authorities the extent to which we are determined to go on supporting those vital services in our communities.

I can say to Members that in every one of the 22 visits that I made to local authorities, every local authority was able to explain to me why the funding formula for local government in Wales uniquely penalised their particular needs and circumstances. When those individuals get together in the finance group, they recognise that our funding formula brings together a whole range of needs, recognising rurality and sparsity, but quite certainly, recognising at its heart, the relative need between our communities. And I look forward to the opportunity to discuss with Members the way in which those considerations feed through to the statement that I will put before the National Assembly tomorrow afternoon.

Thank you very much, Cabinet Secretary.