Thank you. It was on 3 March that the 2020-21 final budget was passed by the Senedd, and so much has happened in the 10 weeks since then. We had already faced an unprecedented set of circumstances in setting our 2020-21 budget plans against the backdrop of ongoing UK-driven austerity, continued Brexit uncertainty and the devastating impacts of the recent flooding. The delayed UK Government budget of 11 March also meant further changes to our settlement. Members will recall that, as a result, I made a commitment to make a statement to provide an update on the forecasts and any other changes to funding for Wales. I am providing that detail today, but obviously we now find ourselves in a dramatically different situation.

We are now responding to the evolving and devastating impacts of the coronavirus pandemic, which is requiring unprecedented levels of Government spending at a pace and scale without rival in the post-war era. I will, therefore, focus today on the extraordinary efforts that the Welsh Government is making to use our budget in the best possible way to respond to the coronavirus crisis, and to show how the decisions we have made reflect our values as a Government.

The outlook for public finances is stark. According to the Office for Budget Responsibility, the UK's fiscal deficit could be £273 billion this year. That is five times higher than expected just two months ago at the time of the UK budget, and significantly higher than at the peak of borrowing during the financial crisis a decade or so ago. This increase will be partly due to higher public expenditure to deal with the current crisis, but also to much lower tax receipts, arising from the reduction in economic activity. Devolved tax revenues will be affected by the lockdown in the same way as other taxes; we can expect a substantial hit. However, the fiscal framework protects our budget from UK-wide economic shocks. As a result, the net impact of reduced economic activity and tax receipts on our budget this year should be small, but we will, of course, be monitoring this situation carefully. 

In terms of the wider economic context, both the OBR and the Bank of England have acknowledged that it is virtually certain that the epidemic, and the necessary measures put in place to contain it, will result in an immediate reduction of economic activity to a degree that's unprecedented in living memory.