The Welsh government has averted a fiscal cliff-edge, passing a £27.5 billion budget for 2026-2027 after striking a last-minute tactical deal with Plaid Cymru.

In a high-stakes vote at the Senedd, the Labour administration managed to unlock vital funds for public services only after the pro-independence party agreed to abstain. The agreement releases a real-terms funding increase across the board, a critical win for First Minister Eluned Morgan just 100 days out from what polls suggest could be a historic election defeat for Labour.

Follow the Money

The budget is designed to be a crowd-pleaser. Amidst crumbling infrastructure and NHS waiting lists, the government has found an extra £1.2 billion compared to the previous fiscal year. The allocations are clearly targeted at soothing voter anger before they head to the ballot box in May.

• NHS Injection: The health and social care budget receives a £180 million boost, a 3.6% rise. "We know that’s what matters to people," Morgan stated, attempting to shore up Labour’s traditional strong suit.
• Council Relief: Local governments, many on the brink of bankruptcy, will see a minimum 4% cash increase, backed by a £113 million pot. This prevents immediate cuts to bin collections, libraries, and leisure centers—issues that bite hard at the local level.

Political Chess

The "politically neutral" budget also sets aside £120 million in capital for the *next* government to spend, a savvy move that acknowledges the shifting tides. With Labour’s century-long hegemony in Wales under threat, this budget may be their final major legislative act.

Plaid Cymru’s decision to abstain rather than block the budget is a calculated gamble. They avoid the chaos of a government shutdown while refusing to explicitly endorse Labour’s spending plans. "Plaid will tell you they’re the ones who made this happen," the First Minister noted wryly. "But they didn’t even back it."

Critics, including the Welsh Liberal Democrats, were unimpressed, accusing Plaid of focusing on "independence studies" while the NHS crumbles. Yet, for tonight, the cheques can be written. The real verdict will be delivered by the Welsh voters in May.