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This accusation represents a grave matter: suggesting Rachel Reeves has deceived the British public, spooking them into accepting billions in extra taxes which would be funneled into increased benefits. While hyperbolic, this isn't usual Westminster sparring; on this occasion, the stakes are higher. A week ago, detractors of Reeves and Keir Starmer were labeling their budget "a shambles". Now, it's branded as lies, with Kemi Badenoch calling for Reeves to step down.

This serious charge demands clear answers, therefore let me provide my view. Did the chancellor tell lies? On current information, no. She told no major untruths. But, notwithstanding Starmer's yesterday's remarks, it doesn't follow that there's nothing to see and we can all move along. The Chancellor did mislead the public regarding the factors shaping her choices. Was this all to funnel cash to "welfare recipients", as the Tories assert? No, and the figures prove this.

A Standing Takes A Further Blow, Yet Truth Must Win Out

Reeves has taken a further blow to her reputation, but, should facts still matter in politics, Badenoch ought to call off her attack dogs. Maybe the resignation recently of OBR head, Richard Hughes, due to the leak of its internal documents will quench Westminster's appetite for scandal.

Yet the true narrative is far stranger compared to media reports suggest, extending wider and further beyond the political futures of Starmer and the class of '24. At its heart, herein lies an account about how much say the public have in the running of our own country. And it should worry everyone.

Firstly, on to the Core Details

After the OBR published recently a portion of the projections it shared with Reeves as she prepared the budget, the shock was immediate. Not merely has the OBR not done such a thing before (described as an "exceptional move"), its figures seemingly contradicted Reeves's statements. Even as rumors from Westminster suggested the grim nature of the budget was going to be, the OBR's own forecasts were improving.

Take the government's most "iron-clad" rule, that by 2030 daily spending for hospitals, schools, and the rest would be wholly paid for by taxes: at the end of October, the OBR calculated this would just about be met, albeit only by a tiny margin.

A few days later, Reeves held a media briefing so extraordinary it forced breakfast TV to break from its usual fare. Several weeks prior to the actual budget, the country was warned: taxes would rise, with the main reason cited as pessimistic numbers from the OBR, in particular its conclusion suggesting the UK had become less productive, investing more but getting less out.

And so! It happened. Despite what Telegraph editorials and Tory broadcast rounds suggested over the weekend, this is basically what happened at the budget, that proved to be big and painful and bleak.

The Misleading Alibi

Where Reeves deceived us concerned her alibi, because those OBR forecasts didn't force her hand. She could have made other choices; she might have provided other reasons, including during the statement. Prior to the recent election, Starmer pledged precisely this kind of public influence. "The promise of democracy. The strength of the vote. The possibility for national renewal."

One year later, yet it is a lack of agency that is evident from Reeves's pre-budget speech. The first Labour chancellor in 15 years portrays herself as a technocrat at the mercy of forces outside her influence: "Given the circumstances of the long-term challenges on our productivity … any chancellor of any political stripe would be in this position today, confronting the choices that I face."

She did make a choice, just not the kind Labour cares to publicize. From April 2029 British workers and businesses are set to be paying another £26bn a year in tax – but most of that will not be spent on better hospitals, public services, or happier lives. Whatever nonsense comes from Nigel Farage, Badenoch and others, it isn't getting splashed on "welfare claimants".

Where the Money Actually Ends Up

Rather than going on services, over 50% of this additional revenue will instead provide Reeves a buffer for her own fiscal rules. Approximately 25% is allocated to covering the administration's policy reversals. Reviewing the OBR's calculations and being as generous as possible to a Labour chancellor, a mere 17% of the taxes will fund genuinely additional spending, for example scrapping the limit on child benefit. Its abolition "costs" the Treasury a mere £2.5bn, because it had long been an act of political theatre by George Osborne. This administration could and should have binned it in its first 100 days.

The Real Target: Financial Institutions

Conservatives, Reform along with all of Blue Pravda have been barking about how Reeves fits the caricature of Labour chancellors, soaking strivers to spend on shirkers. Labour backbenchers are applauding her budget for being a relief to their troubled consciences, safeguarding the most vulnerable. Both sides could be 180-degrees wrong: Reeves's budget was largely aimed at asset managers, speculative capital and the others in the bond markets.

The government can make a strong case in its defence. The forecasts from the OBR were deemed insufficient for comfort, particularly given that lenders demand from the UK the greatest borrowing cost among G7 developed nations – higher than France, which lost a prime minister, and exceeding Japan which has way more debt. Combined with the policies to cap fuel bills, prescription charges as well as train fares, Starmer together with Reeves argue this budget enables the Bank of England to cut its key lending rate.

You can see why those folk with red rosettes may choose not to couch it this way next time they're on the doorstep. As one independent adviser to Downing Street puts it, Reeves has "weaponised" the bond market as an instrument of control against Labour MPs and the voters. It's the reason Reeves cannot resign, no matter what promises she breaks. It's the reason Labour MPs must knuckle down and support measures that cut billions from social security, just as Starmer indicated recently.

A Lack of Statecraft and a Broken Pledge

What's missing from this is the notion of strategic governance, of harnessing the finance ministry and the Bank to forge a fresh understanding with investors. Missing too is intuitive knowledge of voters,