A leading think tank has called on Welsh political parties to be more transparent with the public about the financial difficulties facing the next Welsh Government. The Institute for Fiscal Studies (IFS) said the major parties need to address the “cold, hard reality” of the budget pressures that will confront whoever wins the Senedd election on May 7.
The IFS analysed the manifestos of Welsh Labour, Plaid Cymru, Reform UK, the Welsh Conservatives, the Green Party and the Welsh Liberal Democrats. It found that all parties' plans would add to the fiscal challenges, albeit to different extents. The think tank warned that the next Welsh Government will face a “Welsh budget under significant pressure” due to a slowdown in UK Government funding increases and rising costs for health and social care.
According to the IFS, the Greens' “expansive vision of the welfare state” would require the most additional revenue or cuts elsewhere, while Labour's “more pared-back vision for new entitlements” would create the least extra pressure. The other parties fall in between. However, the IFS noted that all parties pledge significant improvements in schools and the NHS but provide “virtually no detail” on spending commitments.
The think tank stressed that parties must prepare the public for “difficult choices”. It highlighted that any boost to health spending would likely require “particularly deep cuts to services elsewhere”. The IFS also pointed out that Reform UK and the Welsh Conservatives propose a lower-tax Wales with increased investment in roads, while Plaid Cymru, the Greens and the Liberal Democrats advocate a significant expansion of the welfare state, including universal free childcare from nine months to age five.
David Phillips, head of devolved and local government finance at the IFS, said: “The fiscal holes the parties would need to fill differ… But all parties’ plans would add to the fiscal challenges facing the next Welsh Government, to some extent.” He added: “Unfortunately, while differing in their proposals, the major parties have one thing in common: a need to be more upfront about the fiscal challenges facing the next Welsh Government.”
