Senior leaders across the Welsh NHS are pressing the Welsh government to shift away from annual budget cycles and adopt multi-year funding settlements, arguing that longer-term financial certainty is essential for meaningful service transformation. The call comes as BBC News reports that ministers will present draft spending plans for all public services covering the 2027-28 financial year next week, with the health service accounting for nearly half of the Welsh government's £27.5bn annual budget.
Health leaders contend that one-year funding settlements restrict their ability to plan and implement long-term changes to the NHS. The Welsh NHS Alliance, the representative body for NHS organisations across Wales, will present this argument to the Senedd's health committee during evidence sessions examining the 2027-28 spending proposals.
The Welsh government's draft budget will require backing from at least one opposition party to pass through the Senedd. Following negotiations between the administration and opposition parties, the minority Welsh government secured Labour support last week to approve adjustments to its spending plans for the next five months, which included an additional £100m directed at reducing NHS waiting times.
Why does multi-year funding matter?
Annual budgeting cycles create obstacles to delivering sustained improvements in the health service, according to the alliance's written evidence to the committee. The organisation warned that transformation initiatives often require investment over multiple years before their benefits become apparent, and annual planning can undermine these efforts. The alliance stated that
there is a risk that annual planning cycles can constrain longer-term transformation, where benefits often require multi-year investment before being realised.
The alliance emphasised that ministers should prioritise spending that enables
shift Wales from a system focused on treating illness to one that creates health and wellbeing. Achieving this shift demands
multi-year funding certainty and transparent criteria for investment and disinvestment, the organisation argued.
How are interconnected services affected by isolated cuts?
The alliance cautioned against reducing spending in individual service areas without considering wider system effects. Because health and care services are deeply interconnected, cutting expenditure in one area frequently pushes costs elsewhere, typically into more expensive emergency and urgent care provision. The organisation stressed that spending decisions should be guided by
value, outcomes and whole-system impactrather than isolated service reductions.
The alliance called for increased investment in primary and community care, rehabilitation services, public health initiatives, and support for people managing long-term conditions. It warned that
the NHS cannot sustainably meet future demand if resources remain concentrated predominantly at the point of crisis.
What is the broader funding context?
The Welsh government's financial position has been constrained by limited budget settlements. According to the Welsh Government's draft budget documentation, the UK Government's 2025 Spending Review established multi-year resource budgets for devolved governments extending through 2028-29, providing the Welsh Government with a longer-term funding horizon than previously available. This development creates an opportunity for Wales to adopt similar multi-year approaches to health spending.
In June 2026, the Welsh government committed £145m to NHS Wales to reduce waiting times, develop surgical hubs, and improve diagnostics. More recently, on 3 November, the Senedd approved a £354m supplementary budget following an agreement with Welsh Labour, which includes £145m for the NHS, including £100m for reducing waiting lists.
What concerns do council leaders raise?
Local authority leaders responsible for social services, who will also present evidence to the health committee, warned that the sector faces
considerable pressure. In their written submission, councils indicated they remain broadly confident of meeting their legal obligations but expressed growing concerns about the long-term viability of services if current trends persist. Like NHS leaders, council representatives also called for multi-year funding settlements to enable sustainable service planning.
What is the Welsh government's position?
A Welsh government spokesperson responded to the funding calls by stating:
We are working to improve services now while making the longer-term changes needed. That means a stronger focus on prevention, reducing health inequalities and supporting independent living, with services designed around outcomes rather than responding to demand.The statement emphasises the administration's commitment to both immediate service improvements and structural transformation of the health system.
What happens next?
The Senedd's Health and Social Care Committee is scheduled to hold draft-budget evidence sessions on 12 November 2026, where NHS leaders and council representatives will present their cases for multi-year funding. According to the Senedd's published timetable, the 2027-28 draft budget is planned for 17 November 2026, with a Senedd debate on the draft budget scheduled for 19 January 2027. The final budget debate and vote are scheduled for 23 February 2027.
