We haven't had much discussion in this debate, but we have had lots of scrutiny on our capital settlement, and it's worth recognising there that we have had an increase of £60 million to our general capital budget, but also a reduction of £191 million of financial transactions capital. So, overall, our capital funding is down in 2021-22 by £131 million. So, I think that that also demonstrates some of the challenges that we will be facing going ahead.

The Conservative spokesperson said that the pandemic has shone a spotlight on devolution. Well, I'd certainly agree with him in that part, and, certainly, it's the first time that many Whitehall Ministers have noticed devolution. And frankly, they don't like it, because they see decisions being taken in Wales in the best interest of the people of Wales, and that includes the financial decisions that we have been making throughout this pandemic. The pandemic has also shone a spotlight, of course, on the UK Government, and many have commented that they've observed a level of cronyism that they're very uncomfortable with, and it's shone a spotlight on waste by the UK Government also. So, I think that it has been instructive in that sense—to have that spotlight shone on both the devolved Governments and also the UK Government.

And it was particularly galling to hear from the Conservative spokesperson about his concerns about the farming community and his suggestion that Wales hasn't been let down by the UK Government, because, of course, we have. Farmers and our rural communities in Wales are left short changed by £137 million as a result of the UK Government's decisions. On 27 November, I wrote to the Chief Secretary to the Treasury to ask him for a review of the pillar transfer, requesting that the farm funding of £42 million is returned to Wales. It's February, and I still haven't had a formal response to that request, which I understand will now be reflected in the UK Government's supplementary estimates. But I do understand that that request for that £42 million to be returned to us has been declined, which is extremely disappointing. If the UK Government had replaced EU funding in full, Wales would have been better placed to invest in our domestic rural development programme. It's a shame that the UK Government hasn't taken the opportunity to deliver on the promises that it made to rural Wales.

There were lots of comments with regard to local government and the local government settlement. Local authorities again this year have received a good settlement. It's the best settlement that we were able to provide—an increase of £176 million. That's an average increase of 3.8 per cent, and we continue to work with local authorities and Audit Wales to monitor the stability of the sector and individual authorities. Whilst the majority of our funding to local government goes through the hypothecated grant, local authorities also benefit from around £1 billion of support for local services through grants, and I think that that's important to recognise. Local authorities and the WLGA have welcomed the settlement, and I think that we need to recognise that. But equally, I always want to recognise the fact that local authorities are still under a great deal of pressure, and there's absolutely no getting away from that. Two years of good settlements I don't think make up for the decade of austerity that has hit local authorities hard.

I do want to address the serious issues that colleagues have, across the Chamber, commented on with regard to free school meals. I do think it's important to recognise that the Welsh Government has demonstrated its commitment to free school meals by becoming the first nation in the UK to guarantee support right throughout the holidays in April 2020, and then we became the first Government to extend this support all the way through to Easter 2022. I hope that those colleagues who have talked on this issue today will be supporting our budget when we come to the final budget, giving colleagues the opportunity to demonstrate their support for that. Building on the £50 million already announced so far this year, the additional £23.3 million is reflected in the budget to continue the support through the school holidays. I will say that it's important that we do continue to explore all of the options available to us and seek to build on the action that we've already taken, but I do recognise also that it has to be within the context of the budgetary constraints that we're under.