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This charge carries significant weight: suggesting Rachel Reeves may have deceived UK citizens, scaring them to accept massive extra taxes which could be spent on increased welfare payments. While hyperbolic, this isn't typical political sparring; on this occasion, the stakes could be damaging. A week ago, detractors aimed at Reeves and Keir Starmer had been calling their budget "a shambles". Now, it is denounced as lies, and Kemi Badenoch calling for Reeves to step down.

Such a serious charge demands straightforward answers, so let me provide my assessment. Has the chancellor lied? On the available information, no. She told no blatant falsehoods. But, notwithstanding Starmer's yesterday's remarks, it doesn't follow that there's nothing to see and we should move on. Reeves did mislead the public regarding the factors informing her decisions. Was it to channel cash towards "benefits street", like the Tories claim? Certainly not, as the numbers prove this.

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

The Chancellor has taken a further blow to her reputation, however, should facts continue to have anything to do with politics, Badenoch should stand down her attack dogs. Perhaps the stepping down yesterday of OBR head, Richard Hughes, due to the leak of its own documents will quench SW1'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 a story about what degree of influence the public have over the governance of our own country. And it should worry everyone.

Firstly, to Brass Tacks

When the OBR released last Friday some of the forecasts it provided to Reeves while she wrote the red book, the shock was immediate. Not only had the OBR not done such a thing before (described as an "unusual step"), its figures seemingly went against the chancellor's words. Even as rumors from Westminster suggested how bleak the budget was going to be, the watchdog's predictions were improving.

Take the government's so-called "unbreakable" rule, that by 2030 day-to-day spending on hospitals, schools, and the rest would be completely funded by taxes: in late October, the OBR reckoned this would just about be met, albeit only by a tiny margin.

Several 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 actual budget, the country was put on alert: taxes would rise, with the primary cause being pessimistic numbers from the OBR, specifically its finding suggesting the UK had become less productive, putting more in but yielding less.

And so! It happened. Notwithstanding the implications from Telegraph editorials and Tory broadcast rounds suggested recently, that is essentially what happened during the budget, that proved to be significant, harsh, and grim.

The Deceptive Justification

Where Reeves misled us concerned her justification, because those OBR forecasts did not force her hand. She could have made other choices; she could have provided other reasons, including during the statement. Before last year's election, Starmer promised exactly such people power. "The promise of democracy. The strength of the vote. The potential for national renewal."

A year on, yet it's powerlessness that jumps out in Reeves's pre-budget speech. Our first Labour chancellor for a decade and a half portrays herself to be an apolitical figure at the mercy of factors outside her influence: "Given the circumstances of the long-term 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 wishes to broadcast. Starting April 2029 UK workers as well as businesses are set to be paying an additional £26bn a year in taxes – but the majority of this will not be funding better hospitals, new libraries, nor happier lives. Regardless of what nonsense comes from Nigel Farage, Badenoch and others, it is not getting splashed on "benefits street".

Where the Cash Actually Ends Up

Instead of going on services, over 50% of this extra cash will instead give Reeves cushion against her self-imposed fiscal rules. Approximately 25% goes on paying for the government's own policy reversals. Reviewing the OBR's calculations and being as generous as possible towards Reeves, only 17% of the tax take will fund genuinely additional spending, for example abolishing the limit on child benefit. Its abolition "will cost" the Treasury only £2.5bn, because it had long been a bit of theatrical cruelty by George Osborne. This administration could and should abolished it in its first 100 days.

The True Audience: The Bond Markets

The Tories, Reform and the entire right-wing media have spent days railing against the idea that Reeves fits the caricature of left-wing finance ministers, taxing strivers to spend on shirkers. Labour backbenchers have been cheering her budget for being balm to their troubled consciences, protecting the disadvantaged. Each group are completely mistaken: Reeves's budget was largely aimed at investment funds, speculative capital and participants within the bond markets.

Downing Street can make a compelling argument in its defence. The margins from the OBR were too small to feel secure, especially considering bond investors demand from the UK the greatest borrowing cost among G7 rich countries – exceeding that of France, that recently 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 and Reeves can say their plan enables the central bank to cut its key lending rate.

It's understandable that those wearing Labour badges might not frame it in such terms next time they visit #Labourdoorstep. As one independent adviser for Downing Street puts it, Reeves has effectively "weaponised" financial markets as a tool of control against her own party and the electorate. This is the reason the chancellor can't resign, regardless of which promises she breaks. It's the reason Labour MPs will have to fall into line and support measures to take billions off social security, just as Starmer indicated yesterday.

A Lack of Political Vision and an Unfulfilled Pledge

What is absent from this is any sense of strategic governance, of harnessing the Treasury and the central bank to reach a new accommodation with markets. Missing too is intuitive knowledge of voters,