Diolch, Llywydd. I am pleased to make a statement on the 2022-23 draft budget laid on 20 December—the first multi-year budget since 2017.

As we stand at the start of a new year, I want to reflect on the circumstances that shaped our preparations, alongside looking forward to what this budget will deliver. The ongoing impacts of the UK leaving the EU, the pandemic, including the emergence of omicron, and the climate and nature emergency—never before have we faced such circumstances as these. We also have not escaped the long shadow of austerity. While we welcomed the multi-year settlement from the UK Government, it has not delivered for Wales. Our budget in 2024-25 will be nearly £3 billion lower than if it had increased in line with the economy since 2010-11. Between 2022-23 and 2024-25, our resource funding increases by less than half a per cent in real terms. Overall capital funding falls in cash terms in each year of the spending review period and is 11 per cent lower in 2024-25 than in 2021-22.

We also face a UK Government that has broken its promises and is intent on assaulting devolution, taking back powers and funding—a far cry from the rhetoric of levelling up and protecting the union. Under the UK Government's community renewal fund, Wales will receive only £46 million this year, compared to at least £375 million we would have received from EU structural funds from January 2021. The UK Government has also walked away from the industrial legacy of coal mines predating devolution. Yet, at the same time, we have much we can be positive about. I want to recognise the exceptional effort undertaken by everyone in responding to the challenges that we've faced. Despite the context, we have used every lever at our disposal to support not only the Wales of today, but shape a future that is stronger, fairer and greener than it was before.

Collaboration remains at the heart of our approach and we have always been clear that we don't have a monopoly on good ideas. We have entered into a co-operation agreement with Plaid Cymru, the priorities of which can clearly be seen in this budget. This includes additional investment in areas of shared priorities that value our rich heritage and our culture. I've also listened carefully to ideas put forward by Jane Dodds. While we don't have a formal agreement, I have agreed to establish a new £20 million fund, helping deliver vital reforms to services for looked-after children and care leavers. I'm also pleased to build on the constructive debate that we had before the summer recess, on 13 July. You'll see many of the priorities identified by colleagues in that debate reflected in our budget. These include prioritising funding for public services; funding housing and homelessness; funding to pay the real living wage for social care workers from April 2022; a significant investment in our response to the climate and nature emergency; recognising the role of education; and the need to support struggling families.

This budget will take Wales forward. I have delivered on my promise to prioritise funding for health, local authorities and social care. Over the next three years, we will continue to protect, rebuild and develop our public services. We are investing an additional £1.3 billion in our Welsh NHS to provide effective, high-quality and sustainable healthcare, and help recovery from the pandemic. We will stand by our local authorities through close to an additional three quarters of a billion pounds in the local government settlement, providing funding for schools, social care and other vital services. Alongside £60 million of direct additional funding, in 2022-23 alone we are providing over an additional £250 million for social services, including £180 million within the local government settlement to drive forward wider reforms to place it on a sustainable long-term footing.

The pandemic has also created a mental health crisis. In addition to the direct NHS investment, we will invest an additional £100 million targeted at mental health, including more than £10 million for children and young people, recognising the risks of the lasting and long-term impacts felt by our young people in Wales.