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The allegation carries significant weight: that Rachel Reeves has misled the British public, frightening them to accept massive extra taxes which would be funneled into higher benefits. However hyperbolic, this isn't usual political sparring; this time, the consequences are higher. A week ago, critics aimed at Reeves alongside Keir Starmer were calling their budget "disorderly". Now, it is branded as lies, with Kemi Badenoch demanding the chancellor to quit.

Such a grave charge demands straightforward responses, therefore here is my view. Has the chancellor lied? On current information, apparently not. She told no major untruths. But, despite Starmer's yesterday's comments, that doesn't mean there is nothing to see and we should move on. Reeves did mislead the public regarding the considerations shaping her decisions. Was this all to channel cash towards "welfare recipients", like the Tories assert? No, as the numbers prove this.

A Reputation Sustains A Further Blow, Yet Truth Must Win Out

The Chancellor has taken another blow to her reputation, but, should facts continue to have anything to do with politics, Badenoch should stand down her attack dogs. Maybe the stepping down recently of OBR head, Richard Hughes, due to the unauthorized release of its own documents will quench Westminster's appetite for scandal.

Yet the true narrative is much more unusual compared to the headlines indicate, and stretches broader and deeper than the political futures of Starmer and the class of '24. Fundamentally, this is an account concerning what degree of influence the public have in the running of the nation. And it concern you.

First, to Brass Tacks

After the OBR published last Friday a portion of the forecasts it provided to Reeves as she wrote the red book, the shock was instant. Not merely has the OBR not done such a thing before (an "exceptional move"), its figures apparently went against Reeves's statements. Even as rumors from Westminster were about how bleak the budget was going to be, the OBR's own predictions were improving.

Consider the government's most "unbreakable" rule, that by 2030 daily spending on hospitals, schools, and other services would be completely paid for by taxes: in late October, the OBR calculated this would barely be met, albeit by a minuscule margin.

Several days later, Reeves gave a media briefing so unprecedented that it caused breakfast TV to break from its usual fare. Several weeks before the real budget, the country was put on alert: taxes would rise, with the main reason being gloomy numbers provided by the OBR, specifically its finding suggesting the UK had become less efficient, investing more but yielding less.

And lo! It came to pass. Despite the implications from Telegraph editorials and Tory media appearances suggested recently, this is basically what transpired at the budget, that proved to be significant, harsh, and grim.

The Misleading Justification

Where Reeves deceived us concerned her justification, since these OBR forecasts didn't compel her actions. She could have made different options; she could have provided alternative explanations, even on budget day itself. Before the recent election, Starmer promised exactly such people power. "The promise of democracy. The strength of the vote. The potential for national renewal."

One year later, yet it is a lack of agency that is evident from Reeves's pre-budget speech. Our first Labour chancellor in 15 years casts herself as a technocrat buffeted by factors beyond her control: "In the context of the persistent challenges with our productivity … any chancellor of any party would be in this position today, confronting the decisions that I face."

She did make decisions, only not one the Labour party wishes to publicize. Starting April 2029 UK workers as well as businesses will be paying another £26bn a year in taxes – but most of that will not be spent on better hospitals, new libraries, nor enhanced wellbeing. Regardless of what bilge is spouted by Nigel Farage, Badenoch and others, it is not being lavished upon "benefits street".

Where the Money Really Goes

Rather than going on services, over 50% of the extra cash will instead provide Reeves a buffer against her self-imposed budgetary constraints. About 25% goes on covering the government's own U-turns. Examining the OBR's calculations and giving maximum benefit of the doubt towards a Labour chancellor, a mere 17% of the taxes will go on genuinely additional spending, such as scrapping the two-child cap on child benefit. Its abolition "will cost" the Treasury only £2.5bn, because it was always a bit of political theatre from George Osborne. A Labour government should have abolished it immediately upon taking office.

The True Audience: Financial Institutions

The Tories, Reform and the entire right-wing media have spent days barking about the idea that Reeves fits the stereotype of left-wing finance ministers, soaking strivers to fund the workshy. Labour backbenchers have been applauding her budget for being a relief to their social concerns, safeguarding the most vulnerable. Both sides are completely mistaken: Reeves's budget was primarily targeted towards investment funds, speculative capital and the others in the financial markets.

Downing Street could present a compelling argument for itself. The margins from the OBR were insufficient for comfort, especially given that lenders demand from the UK the greatest borrowing cost of all G7 developed nations – exceeding that of France, that recently lost a prime minister, and exceeding Japan which has far greater debt. Coupled with the measures to hold down fuel bills, prescription charges and train fares, Starmer together with Reeves can say their plan allows the central bank to reduce interest rates.

You can see why those folk with Labour badges may choose not to frame it in such terms next time they visit #Labourdoorstep. As a consultant to Downing Street puts it, Reeves has effectively "weaponised" the bond market as an instrument of control against her own party and the electorate. This is the reason Reeves cannot resign, no matter what promises she breaks. It is also why Labour MPs must fall into line and support measures to take billions off social security, just as Starmer promised yesterday.

Missing Statecraft , a Broken Pledge

What's missing from this is any sense of strategic governance, of harnessing the finance ministry and the central bank to forge a new accommodation with markets. Missing too is any intuitive knowledge of voters,