The minister responsible for culture in Wales has denied the sector is facing a funding crisis.

A Senedd committee inquiry into the Welsh government’s budget for 2025-26 has raised “significant concerns” over whether Jack Sargeant “fully appreciates” the pressure that arts, sports and heritage bodies are under.

It comes ahead of a vote on the spending plans on Tuesday, which Labour ministers will lose unless they can convince an opposition Member of the Senedd (MS) to support them.

The Welsh government defended its minister, saying he secured “vital funding for 60 arts organisations” in the past few months.

The claim of a funding crisis came from the Arts Council of Wales, which distributes public funding to arts groups.

When it was put to the minister by the committee at a meeting, the culture minister said: “I wouldn’t describe it as a crisis myself.”

He said there were “challenges” which the government would work to overcome.

In a report on the budget, the culture committee said increased funding for the arts, historic environment and sports in the budget was “a step in the right direction”.

“However, taking into account the evidence we have received about the depth and impact of the funding situation, and the sector’s own use of terms such as ‘crisis’, we have significant concerns about whether the minister fully appreciates the extent of the pressures the sector is facing,” it added.

Welsh government funding has kept some organisations and venues open, the report said.

But MSs heard “many more examples throughout our recent inquiry about other organisations and venues that are struggling”.

The Welsh government said Sargeant “has secured an in year package of immediate support through the resilience fund, providing vital funding for 60 arts organisations across Wales” during his six months in office”.

It added ministers had announced an increase in the draft arts and culture budget for 2025-26.

Committees in all policy areas have been dissecting the budget ahead of Tuesday’s vote.

They have made repeated warnings about the impact of the UK government’s National Insurance hike for employers.

Extra funding has been promised to help public sector employers cope with the cost, but it will not be available for private businesses providing services, such as companies running care homes.

The culture committee called on ministers to confirm “as a matter of urgency” whether government-funded organisations, including museums, will be shielded from increases in NI contributions.

National Museum Wales, for example, faces increased costs of £500,000 – more than half its estimated £900,000 in extra funds for day-to-day spending.

The Senedd’s children and young people’s committee said it was “deeply concerned” about the impact on charities, calling for ministers to accelerate their work to assess and reduce the impact.

It also raised questions about funding for childcare, saying it was not clear whether a plan to extend the Flying Start service to all two-year-olds is fully funded.

The local government committee said councils were still in “very challenging times” and continued to face “substantial budgetary pressures which will most likely lead to council tax increases and cuts to services”.

“We heard that local government is lacking any certainty around budgets and is clearly struggling,” a report said, calling for longer term financial planning to “avoid a cliff edge every year”.

It urged ministers to provide a “funding floor” to protect councils that are expecting to receive increases to their budget far below the average of a 4.3 % increase – something the Welsh government says it is open to.

Under the Welsh government’s funding formula councils with older and more rural populations tend to receive less money – such as Monmouthshire, Powys and Gwynedd. The committee called for a full review of the formula “to ensure that it distributes funding fairly”.

It also raised concerns about national insurance, saying it was not clear how much or when any additional funding would be provided to councils.

The Welsh government has said it will consider the Senedd reports.

With no majority in the Senedd, the Welsh government needs the support of at least one opposition MS to gets its £26bn Budget approved.

After criticism from Plaid Cymru and the Conservatives, it is thought the sole Liberal Democrat MS, Jane Dodds, is the most likely candidate to reach a deal.

Losing Tuesday’s vote on the draft budget would be a blow to the government, but would not be the end of the process.

Negotiations could continue into March when ministers are due to table a final version of their spending plans for the next financial year.

The Welsh government has until the end of the financial year to strike a deal or risk losing £4.15bn less in funding over the course of a year.

Dodds said on Monday it was “incumbent on all of us” for the budget to pass, that discussions were taking place, but that she was not in a position to do a deal with the Welsh government.

It is not known whether she will choose to vote against the budget on Tuesday or abstain.

The Welsh Conservatives said on Monday they would vote against the Welsh government budget.

Tory MS Sam Rowlands said: “Without tackling wasteful spending across departments, the Welsh Labour government will never be able to fully prioritise the Welsh NHS and tackle excessive waiting times that are still increasing to new record highs, month after month.”

Plaid Cymru did not say on Monday if it would vote against the budget.

The party’s Heledd Fychan said: “Labour’s Budget is not one that will address the crisis facing the education or culture sectors, it won’t fix the NHS, and neither will it mean that Councils across Wales will be able to properly deliver key public services that our communities rely on.”