Austerity in Wales has to be understood in the context of the more general budgetary limitations created by the out-dated Barnett formula and the current debates in Wales (and Scotland) about the ways in which devolved functions should be funded in the future. This paper identifies the key measures which successive administrations have taken in support of an essentially Keynesian, counter-cyclical approach to countering recession in Wales. It traces the outcomes of the May 2011 Assembly election and the emerging policy and legislative agenda of the minority Labour administration which that election produced. The paper ends by placing these developments within the wider austerity agenda pursued by the Westminster coalition and its deleterious impact on Wales.
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