Welsh government spending on rural regions will suffer a £1.5 million cut next year, as austerity measures continue. Rural residents will feel the squeeze as the total draft rural budget for 2012/13 has fallen to £90.8m, of which £78.2m will be set aside for revenue funding and £12.6m for capital projects. image expired

Expenditure in three areas of key importance to Welsh farming will be maintained at current levels; these are the Rural Development Plan, Single Farm Payment administration and the Young Entrants’ Support Scheme.

Farming deputy minister Alun Davies said the cuts would help drive farm profitability. He added, "The budget settlement from the UK government means that a reduction in the rural affairs budget is inevitable."

The news comes just months after the Welsh Government announced it would focus on rural revitalisation, with initiatives focusing on rural jobs, affordable housing and improving public services in the countryside as part of its action plan for 2011-2016.

Mr Davies said he remained confident he would be able to deliver on the action plan, despite the drop in funding, "Although the £795m Rural Development Plan 2007-13 is a slight decrease compared to last year, I am confident the reduction will not affect the delivery of the various strands of the plan. It will allow us to continue with funding to farmers under schemes to protect and enhance the countryside; processing and marketing grants to ensure we get the best possible financial return for our produce and funding to improve the quality of life for rural communities."