Public spending on Wales's youngest children has been difficult to track across funding streams and governance levels. Without a consolidated picture of where money goes and who it reaches, policymakers face a significant evidence gap when making investment decisions about the early years. 

Alma Economics was commissioned by Nesta's Fairer Start mission to assess public spending on children aged 0–4 in Wales, ahead of the 2026 Senedd elections. The analysis covered four spending categories: welfare, healthcare, children's services and social care, and funded childcare. Data sources included Households Below Average Income (HBAI) survey microdata, Welsh NHS activity data, local authority revenue outturn data, and administrative data on the Childcare Offer for Wales. 

The analysis produced the first consolidated picture of early years spending in Wales.

Key findings for 2022/23: 

Total spending on children aged 0–4 reached £6,200 per child (£900m in total), 15% above its 2014/15 level.

Welfare is the largest spending area at £3,400 per child, accounting for 55% of total early years spend.

Per-child spending held steady at around £5,300 in real terms between 2014/15 and 2019/20, before rising to £6,200 in 2022/23.

Spending shifted in composition throughout the period — away from welfare, which fell following cuts to benefits and tax credits during the austerity of the 2010s, and towards early education and childcare, driven by the introduction and expansion of the Childcare Offer for Wales from 2017. 

A replicable methodology was developed to support ongoing tracking of early years investment.

Read the full report here

This research was conducted alongside a parallel analysis of early years spending in Scotland, available here.