Early learning is seen as a priority

Finance Minister Sue Essex said spending would rise overall by more than 20% between 2005 and 2007.

The budget increases from just under �12bn to more than �14bn in 2007-08.

But opposition parties in the assembly claimed that patient waiting times would not be cut, and the health budget was lagging behind England.

How spending will change Health 2004/5 - �4.58bn; 2007/8 - �5.5bn Education 2004/5 - �1.22bn; 2007/8 - �1.54bn Environment 2004/5 - �116m; 2007/8 - �151m Housing 2004/5 - �56.4m; 2007/8 - �92.4m Community regeneration 2004/5 - �71.1m; 2007/8 - �98m Culture 2004/5 - �92.3m; 2007/8 - �104.6m Welsh language 2004/5 - �12.4m; 2007/8 - �13.4m

Health spending goes up from �4.58bn to �5.5bn in 2007/8, and early learning budget almost quadruples.

Education Minister Jane Davidson said: "When I've looked at other countries that are out-performing Wales educationally, what I've seen is a huge emphasis on early years.

"We know that, if we put in the investment, we will give our children the best possible start in life."

The early learning budget affects children aged between three and seven, with more money for support staff and classroom assistants, with the aim of reducing pupil to teacher ratios.

Spending on culture, the Welsh language, and sport will rise from the current �124.6m to �150.9m in 2007/8.

A total of �30m has been set aside for housing schemes for the elderly, but there are only modest increases for local government and economic development.

'Sustainable direction'

Budgets have been frozen for the soon-to-be-abolished quangos the Welsh Development Agency and the Wales Tourist Board.

Explaining the decisions she had made, Ms Essex said : "What we have unveiled is a budget for the future of Wales.

"We know that we have to use this money to set a sustainable direction for the future of Wales."

But Plaid Cymru finance spokesman Dai Lloyd said patients would have longer waits for treatment because of a lack of investment compared to England.

"Over the same period the health budget is going up in England by 29% but only by 20% in Wales," said Dr Lloyd.

"Already waiting lists in Wales are twice as long as they are in England. This poor budget settlement for health will only make matters worse."

Plaid also complained about funding for the rural economy, higher education and to tackle teachers' workload and improving north-south road links.

Conservative finance spokesman Mark Isherwood said: "This budget once again misses the target.

"The spending has increased, but once again, areas where money is desperately needed will miss out for another year as the Welsh Assembly Government pursues its agenda to be a 'spend more, deliver less' government.

"It is not how much you are given by Gordon Brown for Welsh services, it is how you spend it".

Liberal Democrat AM Jenny Randerson claimed Labour had given up on "a fair deal for students and universities".

The Welsh Lib Dems' finance spokeswoman said: "The Labour assembly government seems to have washed its hands of dealing with the twin problems of growing student debt and funding our universities to compete in the knowledge-based global economy."

She also argued that patients would face more waiting, as it would be until 2007-8 before "serious money" was given to implementing the recommendations of health funding expert Derek Wanless.

Cymdeithas yr Iaith Gymraeg has written to First Minister Rhodri Morgan claiming there was no strategy to enable young people from Wales to buy houses in their local communities.

The Welsh Local Government Association expressed its discontent at the budget.

WLGA leader Alex Aldridge said: "This outcome is disappointing but we have sought to work closely with the assembly government over the past months to ensure that areas of growth concentrate on key services."