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This allegation is a serious one: suggesting Rachel Reeves may have lied to the British public, scaring them into accepting billions in additional taxes which would be funneled into higher welfare payments. However hyperbolic, this is not usual political sparring; this time, the stakes are higher. A week ago, detractors of Reeves alongside Keir Starmer were calling their budget "a mess". Now, it is denounced as falsehoods, with Kemi Badenoch demanding the chancellor's resignation.

This grave accusation requires straightforward responses, therefore here is my view. Has the chancellor been dishonest? On the available information, no. She told no major untruths. However, notwithstanding Starmer's recent remarks, that doesn't mean there's nothing to see and we should move on. The Chancellor did mislead the public about the considerations informing her decisions. Was it to funnel cash to "welfare recipients", like the Tories claim? No, as the numbers demonstrate this.

A Reputation Sustains A Further Blow, But Facts Must Win Out

Reeves has sustained another hit to her reputation, however, if facts still have anything to do with politics, Badenoch should stand down her lynch mob. Maybe the resignation recently of OBR head, Richard Hughes, due to the unauthorized release of its own documents will satisfy Westminster's thirst for blood.

But the real story is much more unusual than the headlines indicate, extending wider and further beyond the political futures of Starmer and his class of '24. Fundamentally, this is a story about what degree of influence you and I have in the running of the nation. And it concern you.

First, on to Brass Tacks

After the OBR published recently a portion of the projections it shared with Reeves while she prepared the budget, the shock was instant. Not merely has the OBR not acted this way before (described as an "rare action"), its numbers seemingly went against Reeves's statements. While rumors from Westminster were about how bleak the budget was going to be, the OBR's own predictions were getting better.

Consider the Treasury's so-called "iron-clad" rule, stating by 2030 daily spending for hospitals, schools, and other services would be wholly funded by taxes: at the end of October, the watchdog calculated this would barely be met, albeit by a tiny margin.

Several days later, Reeves gave a media briefing so extraordinary that it caused breakfast TV to break from its usual fare. Several weeks prior to the actual budget, the country was put on alert: taxes were going up, with the main reason cited as pessimistic numbers provided by the OBR, in particular its finding that the UK was less efficient, investing more but getting less out.

And so! It came to pass. Notwithstanding what Telegraph editorials combined with Tory broadcast rounds implied over the weekend, this is essentially what happened during the budget, which was big and painful and bleak.

The Misleading Justification

Where Reeves deceived us concerned her justification, since those OBR forecasts did not force her hand. She could have made other choices; she might have provided other reasons, even on budget day itself. Prior to the recent election, Starmer pledged precisely this kind of people power. "The hope of democracy. The strength of the vote. The potential for national renewal."

A year on, yet it's a lack of agency that jumps out from Reeves's breakfast speech. Our first Labour chancellor in 15 years portrays herself to be a technocrat at the mercy of forces outside her influence: "Given the circumstances of the long-term challenges with our productivity … any finance minister of any party would be standing here today, confronting the decisions that I face."

She did make decisions, just not the kind the Labour party wishes to broadcast. From April 2029 British workers as well as businesses are set to be contributing another £26bn annually in tax – but the majority of this will not go towards funding improved healthcare, public services, or enhanced wellbeing. Whatever bilge comes from Nigel Farage, Badenoch and their allies, it is not being lavished upon "benefits street".

Where the Cash Really Goes

Rather than being spent, more than 50% of the additional revenue will in fact provide Reeves a buffer against her own fiscal rules. Approximately 25% goes on paying for the government's own U-turns. Examining the OBR's calculations and being as generous as possible towards a Labour chancellor, a mere 17% of the tax take will fund genuinely additional spending, such as abolishing the limit on child benefit. Its abolition "will cost" the Treasury only £2.5bn, because it had long been an act of political theatre from George Osborne. This administration should have abolished it immediately upon taking office.

The True Audience: The Bond Markets

The Tories, Reform and the entire right-wing media have spent days railing against the idea that Reeves conforms to the stereotype of left-wing finance ministers, taxing strivers to fund the workshy. Labour backbenchers have been applauding her budget for being balm to their social concerns, protecting the disadvantaged. Both sides could be completely mistaken: Reeves's budget was primarily targeted towards asset managers, hedge funds and participants within the bond markets.

The government can make a strong case in its defence. The margins from the OBR were deemed too small to feel secure, particularly given that bond investors charge the UK the highest interest rate of all G7 rich countries – higher than France, which lost its leader, and exceeding Japan that carries way more debt. Combined with the measures to hold down fuel bills, prescription charges as well as train fares, Starmer together with Reeves argue their plan allows the Bank of England to cut its key lending rate.

You can see why those folk with Labour badges might not frame it in such terms when they visit the doorstep. According to a consultant to Downing Street says, Reeves has "weaponised" financial markets as an instrument of discipline against her own party and the electorate. This is why the chancellor cannot resign, no matter what pledges are broken. It is also the reason Labour MPs must fall into line and vote that cut billions from social security, as Starmer indicated recently.

Missing Statecraft , an Unfulfilled Promise

What is absent from this is any sense of strategic governance, of harnessing the Treasury and the Bank to forge a fresh understanding with markets. Missing too is intuitive knowledge of voters,