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This allegation represents a grave matter: suggesting Rachel Reeves has misled Britons, scaring them to accept massive additional taxes which could be funneled into increased welfare payments. However exaggerated, this is not usual Westminster bickering; on this occasion, the stakes are higher. Just last week, critics of Reeves and Keir Starmer had been labeling their budget "a mess". Today, it is branded as falsehoods, and Kemi Badenoch demanding the chancellor's resignation.

This serious charge requires clear answers, therefore let me provide my view. Has the chancellor tell lies? On the available evidence, apparently not. She told no whoppers. But, despite Starmer's recent remarks, it doesn't follow that there is nothing to see and we can all move along. The Chancellor did mislead the public regarding the considerations informing her decisions. Was this all to channel cash towards "welfare recipients", as the Tories assert? Certainly not, as the figures prove this.

A Reputation Takes A Further Blow, But Facts Must Prevail

Reeves has sustained a further blow to her standing, but, if facts still matter in politics, Badenoch ought to call off her lynch mob. Maybe the resignation yesterday of OBR head, Richard Hughes, due to the unauthorized release of its own documents will quench SW1's thirst for blood.

Yet the real story is much more unusual than the headlines indicate, and stretches broader and deeper beyond the careers of Starmer and his class of '24. Fundamentally, this is a story concerning what degree of influence you and I have in the running of our own country. And it should worry everyone.

Firstly, on to Brass Tacks

After the OBR released recently a portion of the projections it shared with Reeves as she prepared the budget, the shock was instant. Not only had the OBR never acted this way before (an "rare action"), its figures apparently went against the chancellor's words. Even as leaks from Westminster suggested how bleak the budget was going to be, the OBR's own forecasts were getting better.

Take the Treasury's so-called "iron-clad" rule, stating by 2030 day-to-day spending on hospitals, schools, and other services must be completely paid for by taxes: at the end of October, the OBR reckoned this would just about be met, albeit by a tiny margin.

A few days later, Reeves held a media briefing so extraordinary that it caused breakfast TV to break from its usual fare. Several weeks before the actual budget, the nation was put on alert: taxes would rise, and the main reason being pessimistic numbers provided by the OBR, in particular its conclusion that the UK was less efficient, investing more but yielding less.

And lo! It happened. Despite the implications from Telegraph editorials combined with Tory media appearances implied recently, this is basically what transpired at the budget, which was significant, harsh, and grim.

The Deceptive Alibi

Where Reeves deceived us was her justification, because those OBR forecasts didn't force her hand. She could have made different options; she could have provided other reasons, including during the statement. Prior to the recent election, Starmer pledged exactly such public influence. "The hope of democracy. The strength of the vote. The possibility for national renewal."

One year later, yet it is a lack of agency that jumps out from Reeves's pre-budget speech. The first Labour chancellor in 15 years casts herself to be a technocrat at the mercy of forces outside her influence: "Given the circumstances of the persistent challenges on our productivity … any finance minister of any party would be in this position today, facing the decisions that I face."

She did make decisions, just not one Labour cares to broadcast. From April 2029 British workers as well as businesses are set to be contributing an additional £26bn a year in taxes – and the majority of this will not be funding better hospitals, new libraries, nor happier lives. Whatever nonsense is spouted by Nigel Farage, Badenoch and their allies, it isn't getting splashed on "welfare claimants".

Where the Cash Really Goes

Instead of going on services, more than 50% of the extra cash will instead provide Reeves cushion for her self-imposed fiscal rules. About 25% is allocated to covering the administration's policy reversals. Reviewing the OBR's calculations and giving maximum benefit of the doubt towards Reeves, a mere 17% of the taxes will go on genuinely additional spending, such as scrapping the two-child cap on child benefit. Removing it "costs" the Treasury a mere £2.5bn, because it was always an act of political theatre by George Osborne. A Labour government could and should have binned it immediately upon taking office.

The True Audience: Financial Institutions

Conservatives, Reform along with all of right-wing media have spent days railing against the idea that Reeves conforms to the caricature of left-wing finance ministers, soaking strivers to spend on the workshy. Party MPs are cheering her budget as a relief to their troubled consciences, protecting the most vulnerable. Both sides could be 180-degrees wrong: Reeves's budget was primarily aimed at asset managers, speculative capital and the others in the bond markets.

Downing Street can make a compelling argument in its defence. The margins from the OBR were deemed insufficient to feel secure, particularly considering lenders demand from the UK the greatest borrowing cost of all G7 developed nations – exceeding that of France, which lost a prime minister, and exceeding Japan which has far greater debt. Combined with the policies to cap fuel bills, prescription charges and train fares, Starmer together with Reeves can say their plan enables the Bank of England to cut interest rates.

You can see that those folk with red rosettes might not frame it this way when they're on #Labourdoorstep. According to one independent adviser for Downing Street says, Reeves has effectively "weaponised" financial markets as an instrument of control against her own party and the voters. It's the reason the chancellor cannot resign, no matter what promises she breaks. It's why Labour MPs must knuckle down and support measures to take billions off social security, just as Starmer promised yesterday.

A Lack of Statecraft and an Unfulfilled Pledge

What's missing from this is any sense of strategic governance, of mobilising the Treasury and the Bank to forge a fresh understanding with markets. Missing too is innate understanding of voters,