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The accusation represents a grave matter: suggesting Rachel Reeves may have misled Britons, spooking them to accept billions in extra taxes which would be funneled into higher benefits. While hyperbolic, this is not usual Westminster bickering; this time, the consequences are higher. Just last week, detractors of Reeves and Keir Starmer were labeling their budget "a shambles". Now, it is branded as lies, with Kemi Badenoch calling for the chancellor to quit.

This grave accusation requires straightforward responses, so let me provide my assessment. Has the chancellor lied? On the available information, apparently not. She told no major untruths. But, despite Starmer's yesterday's remarks, it doesn't follow that there is no issue here and we can all move along. The Chancellor did mislead the public about the considerations shaping her decisions. Was this all to funnel cash towards "welfare recipients", like the Tories claim? Certainly not, and the figures demonstrate this.

A Standing Sustains A Further Hit, But Facts Must Prevail

Reeves has taken a further blow to her standing, but, if facts still have anything to do with politics, Badenoch ought to stand down her lynch mob. Perhaps the stepping down yesterday of the Office for Budget Responsibility (OBR) chief, Richard Hughes, due to the unauthorized release of its internal documents will quench SW1's thirst for blood.

Yet the true narrative is far stranger compared to the headlines indicate, and stretches broader and deeper beyond the careers of Starmer and the class of '24. At its heart, this is a story concerning how much say you and I get in the governance of the nation. And it should worry you.

Firstly, to Brass Tacks

After the OBR released last Friday a portion of the projections it provided to Reeves while she wrote the red book, the surprise was instant. Not only has the OBR never acted this way before (an "unusual step"), its numbers seemingly contradicted Reeves's statements. Even as leaks from Westminster were about how bleak the budget would have to be, the OBR's own forecasts were improving.

Consider the Treasury's so-called "unbreakable" rule, that by 2030 daily spending for hospitals, schools, and the rest would be wholly paid for by taxes: in late October, the OBR reckoned this would barely be met, albeit by a minuscule margin.

Several days later, Reeves held a media briefing so unprecedented that it caused breakfast TV to break from its regular schedule. Weeks prior to the real budget, the country was warned: taxes would rise, with the main reason cited as gloomy numbers from the OBR, in particular its finding suggesting the UK had become less productive, putting more in but getting less out.

And lo! It happened. Notwithstanding what Telegraph editorials combined with Tory media appearances implied recently, this is basically what transpired during the budget, which was big and painful and bleak.

The Deceptive Justification

Where Reeves deceived us concerned her alibi, because those OBR forecasts didn't compel her actions. She could have chosen different options; she might have provided alternative explanations, even on budget day itself. Prior to last year's election, Starmer promised exactly such public influence. "The promise of democracy. The power of the vote. The possibility for national renewal."

A year on, and it is a lack of agency that is evident in Reeves's pre-budget speech. Our first Labour chancellor in 15 years portrays herself to be an apolitical figure buffeted by forces beyond her control: "In the context of the persistent challenges with our productivity … any chancellor of any political stripe would be standing here today, confronting the choices that I face."

She did make decisions, only not the kind Labour cares to broadcast. From April 2029 UK workers as well as businesses will be paying an additional £26bn a year in taxes – and most of that will not go towards spent on improved healthcare, public services, nor enhanced wellbeing. Regardless of what nonsense comes from Nigel Farage, Badenoch and others, it is not getting splashed on "welfare claimants".

Where the Cash Really Goes

Instead of going on services, more than 50% of the additional revenue will in fact provide Reeves cushion for her own budgetary constraints. About 25% is allocated to covering the government's own policy reversals. Examining the watchdog's figures and giving maximum benefit of the doubt to Reeves, a mere 17% of the tax take will fund actual new spending, such as scrapping the limit on child benefit. Removing it "costs" the Treasury a mere £2.5bn, because it had long been an act of theatrical cruelty from George Osborne. A Labour government could and should abolished it in its first 100 days.

The Real Target: The Bond Markets

The Tories, Reform along with the entire right-wing media have spent days barking about how Reeves fits the stereotype of Labour chancellors, soaking strivers to fund the workshy. Party MPs are applauding her budget as a relief to their social concerns, safeguarding the disadvantaged. Each group are completely mistaken: The Chancellor's budget was largely targeted towards asset managers, speculative capital and the others in the bond markets.

The government could present a compelling argument in its defence. The margins provided by the OBR were too small for comfort, particularly considering bond investors demand from the UK the greatest borrowing cost among G7 rich countries – higher than France, that recently lost a prime minister, and exceeding Japan which has far greater debt. Coupled with the policies to cap fuel bills, prescription charges and train fares, Starmer together with Reeves argue this budget enables the Bank of England to cut interest rates.

You can see why those wearing red rosettes might not couch it in such terms when they're on the doorstep. As a consultant to Downing Street says, Reeves has effectively "weaponised" financial markets as an instrument of discipline over her own party and the voters. This is the reason the chancellor can't resign, regardless of which promises she breaks. It is also the reason Labour MPs must fall into line and vote that cut billions from social security, just as Starmer promised yesterday.

A Lack of Political Vision and an Unfulfilled Pledge

What is absent from this is the notion of statecraft, of harnessing the Treasury and the Bank to reach a fresh understanding with investors. Missing too is any intuitive knowledge of voters,