Finance is one of the corporate areas for change in the Statutory Guidance issued by Welsh Government on the implementation of the Act.

We have made some proactive interventions that seek to improve the systems of finance and decision-making which underpin public services, as in times of pressures on public finances from COVID-19 as well as austerity and Brexit we need to ensure that every penny spent maximises its contribution to all four dimensions of well-being.

We could see that decisions about finance and investment often act as a barrier rather than an opportunity to help achieve the well-being goals, and embed the five ways of working

The Welsh Government budget is the single biggest decision (or set of decisions) that is taken by a public body in Wales each year. As well as determining how public services are funded, the budget process and decisions send important signals about priorities across our public services and shows whether those priorities are shifting to realise the aspirations of the Well-being of Future Generations Act.

We have dedicated significant resource to monitor and assess the draft budget over three consecutive years and provided advice to Government and evidence to the Senedd Finance Committee in 2017, 2018 and 2019.

Welsh Government annual Draft Budget Process

Traditional, siloed structures in Welsh Government (and other public bodies) are often not designed to enable an integrated approach to financial decision-making. Cabinet portfolios are often focused on driving a specific outcome and the way that the budget groups are still organised means it can be challenging for collaborative decisions to be made that take account of the causes and effects of key issues facing future generations.


  • Draft Budget 2021 - 22
    Draft Budget 2021 - 22

    I recognise the significant challenges that the Welsh Government has faced in the past year, and it is positive that the draft budget for 2021-22, published in December 2020, emphasises the importance of a green and just recovery.

    I have provided analysis of the draft budget to Government and to the Senedd Finance Committee, including areas where I consider progress has been made as well as key areas I think should be prioritised for increased investment. 


    Positive improvements

    I am pleased to see that spending on sustainable travel continues to increase – it has increased by 63% since 2019-20, alongside increases in investment in active travel, Metro and rail schemes and Electric Vehicle Infrastructure. However, in terms of how this funding is delivered, Government should consider multi-year allocations for active travel schemes to enable them to be properly planned and delivered.

    I consider there have been some positive decisions made in relation to funding the decarbonisation of homes, building on the Optimised Retrofit Programme developed in the past year, although there is a pressing need for a longer-term plan for funding the decarbonisation of housing stock. Government should increase investment in housing retrofit and secure multi-year long term commitments to scale up action over the next decade. 

    Areas for further consideration

    There are several other areas that I have consistently highlighted as key opportunities for a green and just recovery, in which I consider there to be a funding shortfall in the draft budget. 

    The key area is investment in skills and employability, which has to underpin Wales’ recovery from the pandemic. I think there is a particular opportunity for Government to make the links with the climate and nature emergencies and invest in the development of skills in sectors that are shown to have significant job creation for a green and just recovery. As outlined in my analysis I am concerned that the allocations set out in the draft budget are insufficient to keep pace with both rising demand and the rapidly changing labour market and I am recommending some specific areas for increased investment. Government should consider how it can guarantee greater investment in skills and employability for a zero-carbon economy, particularly through enhancing access to sectors well placed for a green recovery. 

    I also highlight opportunities for investment in town and city centre regeneration to support increases in remote working; for investment in the culture sector and creative industries as a core part of recovery; and further investment in nature-based solutions. Government should ensure that investment achieves benefits in relation to as many of the well-being goals as possible – for example considering how their spending proposals for town and city regeneration can better support remote working, can involve the culture sector and can create green infrastructure. 

    Whilst the pandemic has been devastating and challenging in many ways, it has also brought benefits, including new ways of working innovatively, digitally and collaboratively, which have the potential to become a change in the culture of how we do things in Wales.Government should ensure that investment across portfolios ‘sustains the good’ through supporting new positive ways of working when we move into recovery mode and the temptation might be to fall back to the ‘old normal’.

    I am pleased that Government have started a programme of work to better understand the level of carbon emissions that result from budgetary decisions. Government should assess the carbon impact of their spend, especially major capital spend, and publish details of the overall carbon impact of their budget and major investment and infrastructure decisions. 


    FGCW Scrutiny of the Welsh Government draft Budget 2021 – 22

    Annex 1 – Advice to Government on priorities for investment in a green and just recovery 

    Annex 2 – Advice to Government on priorities for capital spend

  • Draft budget 2020-21
    Draft budget 2020-21

    The work that I have undertaken with the Welsh Treasury over the last two years, working with the New Economics Foundation and Social Finance has led to the publication this year of a Budget Improvement Plan which sets out what Welsh Government think that progress should look like in terms of the budget process aligning with the requirements of the Well-being of Future Generations Act.

    My work on the Welsh Government annual draft budget has focused on key areas for change:


    My work has shown that more needs to be done by Government to demonstrate a cross-government, coherent and evidence-based approach to prevention. I have worked with Government officials to explore the definition of prevention and preventative spend and I am now using this to challenge Government spending decisions.

    Prevention is working in partnership to co-produce the best outcomes possible, utilising the strengths and assets people and places have to contribute. Breaking down into four levels, each level can reduce demand for the next:

    • Primary prevention (PP) – Building resilience – creating the conditions in which problems do not arise in the future. A universal approach.
    • Secondary prevention (SP) – Targeting action towards areas where there is a high risk of a problem occurring. A targeted approach, which cements the principles of progressive universalism*
    • Tertiary prevention (TP) – Intervening once there is a problem, to stop it getting worse and prevent it reoccurring in the future. An intervention approach
    • Acute spending (AS) – Spending, which acts to manage the impact of a strongly negative situation but does little or nothing to prevent problems occurring in the future. A remedial approach.* progressive universalism is a determination to provide support for all, giving everyone and everything a voice and vested interest, but recognises more support will be required by those people or areas with greater needs.


    In June 2019, I published a Ten Point plan to fund the Climate Emergency which suggests how Welsh Government’s budget could increase investment in climate action, focusing on:

    • Greater investment in active travel, public transport and electric vehicle infrastructure.
    • Greater investment in a national housing retrofit programme – focusing initially on homes living in fuel poverty and those in social ownership could cost up to £1 billion.
    • Wales becoming self-sufficient in renewable electricity by 2035.
    • Increasing tree cover and the adoption of low carbon agricultural practices and re-thinking land-use practice.
    • Ensuring that decarbonisation is a key principle and driver for decision making within planning, public sector procurement contracts and pension fund investments supported by a programme to train a carbon-literate public sector.

    I was pleased to see an allocation of £140 million to support action on climate and nature in Welsh Government’s 2020-21 budget, in line with what I proposed, and also an increase in funding for sustainable transport and active travel.

    There is also huge potential to contribute to the well-being goals via the £6.1 billion which is currently spent by the public sector in Wales on procurement and you can read about my work in this area here


    Read the Welsh Government Draft Budget 2019-20

    Read our advice on how Welsh Government’s draft budget (2020-21) is taking account of the Act