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This charge is a serious one: that Rachel Reeves has deceived UK citizens, frightening them into accepting massive additional taxes which would be spent on higher welfare payments. However exaggerated, this is not usual political sparring; this time, the consequences are more serious. Just last week, detractors of Reeves and Keir Starmer were labeling their budget "disorderly". Now, it is branded as lies, and Kemi Badenoch calling for Reeves to step down.

Such a serious accusation demands clear answers, therefore here is my view. Has the chancellor tell lies? On the available information, no. She told no blatant falsehoods. However, notwithstanding Starmer's yesterday's remarks, that doesn't mean there's nothing to see and we can all move along. Reeves did mislead the public about the considerations informing her decisions. Was it to funnel cash towards "benefits street", like the Tories claim? No, and the numbers prove it.

A Standing Sustains A Further Blow, But Facts Should Prevail

The Chancellor has taken another blow to her reputation, however, if facts still matter in politics, Badenoch ought to call off her attack dogs. Perhaps the stepping down recently of OBR head, Richard Hughes, due to the unauthorized release of its internal documents will quench Westminster's thirst for blood.

But the true narrative is far stranger than the headlines indicate, extending broader and deeper than the careers of Starmer and his 2024 intake. At its heart, herein lies a story concerning what degree of influence the public get in the running of the nation. And it should worry everyone.

First, to Brass Tacks

After the OBR released last Friday a portion of the projections it provided to Reeves as she prepared the red book, the shock was immediate. Not only has the OBR not done such a thing before (an "rare action"), its figures apparently contradicted Reeves's statements. While leaks from Westminster suggested how bleak the budget would have to be, the watchdog's forecasts were improving.

Take the government's so-called "iron-clad" rule, that by 2030 day-to-day spending on hospitals, schools, and the rest would be completely paid for by taxes: in late October, the OBR calculated it would just about be met, albeit only by a minuscule margin.

A few days later, Reeves gave a press conference so extraordinary that it caused morning television to break from its usual fare. Several weeks prior to the real budget, the country was put on alert: taxes would rise, and the main reason being gloomy numbers from the OBR, in particular its conclusion suggesting the UK had become less efficient, putting more in but getting less out.

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

The Misleading Justification

The way in which Reeves deceived us concerned her justification, since those OBR forecasts did not force her hand. She might have made different options; she might have provided other reasons, even on budget day itself. Before the recent election, Starmer pledged precisely this kind of people power. "The hope of democracy. The strength of the vote. The possibility for national renewal."

One year later, and it is powerlessness that is evident in Reeves's pre-budget speech. The first Labour chancellor in 15 years casts herself as a technocrat at the mercy of forces beyond her control: "In the context of the persistent challenges on our productivity … any finance minister of any party would be in this position today, confronting the decisions that I face."

She certainly make decisions, only not the kind the Labour party cares to publicize. Starting April 2029 British workers and businesses will be contributing another £26bn annually in taxes – but most of that will not go towards spent on better hospitals, public services, or happier lives. Regardless of what nonsense is spouted by Nigel Farage, Badenoch and their allies, it isn't getting splashed on "benefits street".

Where the Cash Actually Ends Up

Rather than being spent, more than 50% of this additional revenue will in fact provide Reeves a buffer against her own budgetary constraints. About 25% goes on covering the administration's policy reversals. Examining the OBR's calculations and being as generous as possible to Reeves, only 17% of the taxes will go on genuinely additional spending, for example scrapping the two-child cap on child benefit. Its abolition "will cost" the Treasury only £2.5bn, as it had long been a bit of political theatre by George Osborne. A Labour government should have have binned it immediately upon taking office.

The True Audience: Financial Institutions

Conservatives, Reform and all of right-wing media have spent days barking about how Reeves conforms to the caricature of Labour chancellors, taxing strivers to fund the workshy. Labour backbenchers are applauding her budget as a relief for their social concerns, protecting the most vulnerable. Each group could be completely mistaken: Reeves's budget was largely aimed at asset managers, speculative capital and the others in the bond markets.

Downing Street could present a compelling argument in its defence. The forecasts provided by the OBR were too small to feel secure, particularly given that lenders charge the UK the highest interest rate of all G7 rich countries – exceeding that of France, which lost its leader, higher than Japan which has far greater debt. Combined with the policies to hold down fuel bills, prescription charges as well as train fares, Starmer together with Reeves argue their plan enables the Bank of England to cut interest rates.

You can see why those wearing red rosettes may choose not to frame it this way next time they visit #Labourdoorstep. According to one independent adviser to Downing Street puts it, Reeves has effectively "weaponised" the bond market to act as an instrument of discipline against her own party and the electorate. This is why the chancellor can't resign, no matter what pledges she breaks. It is also why Labour MPs must knuckle down 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 here is any sense of statecraft, of harnessing the finance ministry and the Bank to forge a fresh understanding with investors. Also absent is intuitive knowledge of voters,