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The allegation is a serious one: that Rachel Reeves may have deceived Britons, spooking them to accept massive additional taxes that could be spent on higher welfare payments. While exaggerated, this isn't typical political sparring; this time, the stakes are higher. A week ago, detractors of Reeves alongside Keir Starmer were calling their budget "uncoordinated". Today, it is denounced as falsehoods, and Kemi Badenoch calling for the chancellor to quit.

Such a serious accusation requires clear answers, so here is my view. Did the chancellor tell lies? Based on the available evidence, no. There were no major untruths. However, despite Starmer's yesterday's remarks, that doesn't mean there's no issue here and we can all move along. The Chancellor did mislead the public about the considerations shaping her decisions. Was it to funnel cash towards "benefits street", like the Tories claim? Certainly not, as the numbers prove this.

A Standing Sustains Another Hit, Yet Truth Should Prevail

Reeves has sustained a further hit to her reputation, but, should facts still have anything to do with politics, Badenoch ought to call off her attack dogs. Maybe the stepping down yesterday of the Office for Budget Responsibility (OBR) chief, Richard Hughes, over the leak of its own documents will quench SW1's thirst for blood.

Yet the true narrative is much more unusual than the headlines suggest, and stretches wider and further than the careers of Starmer and the 2024 intake. At its heart, this is an account about what degree of influence the public have over the governance of our own country. And it concern everyone.

First, to Brass Tacks

When the OBR released recently some of the forecasts it shared with Reeves while she prepared the red book, the shock was instant. Not only had the OBR never done such a thing before (an "rare action"), its numbers apparently went against Reeves's statements. While rumors from Westminster suggested how bleak the budget was going to be, the OBR's own forecasts were getting better.

Take the government's most "iron-clad" rule, stating by 2030 day-to-day spending for hospitals, schools, and other services must be wholly funded by taxes: in late October, the watchdog calculated this would barely be met, albeit by a tiny margin.

A few days later, Reeves held a media briefing so extraordinary it forced breakfast TV to interrupt its regular schedule. Weeks prior to the real budget, the nation was put on alert: taxes would rise, with the primary cause being pessimistic numbers provided by the OBR, specifically its conclusion suggesting the UK had become less productive, investing more but getting less out.

And so! It came to pass. Despite what Telegraph editorials and Tory media appearances implied recently, this is basically what transpired at the budget, that proved to be big and painful and bleak.

The Deceptive Justification

The way in which Reeves misled us concerned her justification, since those OBR forecasts did not force her hand. She could have chosen different options; she could have given other reasons, including on budget day itself. Prior to the recent election, Starmer promised exactly such people power. "The hope of democracy. The strength of the vote. The potential for national renewal."

One year later, yet it is powerlessness that is evident from Reeves's pre-budget speech. Our first Labour chancellor in 15 years portrays herself as an apolitical figure buffeted by factors outside her influence: "In the context of the long-term challenges with our productivity … any chancellor of any party would be standing here today, confronting the decisions that I face."

She did make decisions, only not the kind Labour cares to broadcast. Starting April 2029 British workers and businesses will be contributing an additional £26bn a year in tax – but the majority of this will not go towards spent on improved healthcare, public services, nor enhanced wellbeing. Whatever nonsense comes from Nigel Farage, Badenoch and their allies, it is not getting splashed on "benefits street".

Where the Money Really Goes

Rather than being spent, over 50% of this additional revenue will in fact give Reeves a buffer for her self-imposed fiscal rules. Approximately 25% is allocated to paying for the administration's policy reversals. Reviewing the watchdog's figures and being as generous as possible towards Reeves, a mere 17% of the taxes will fund actual new spending, for example scrapping the two-child cap on child benefit. Removing it "costs" the Treasury only £2.5bn, because it was always a bit of political theatre from George Osborne. A Labour government should have abolished it in its first 100 days.

The Real Target: Financial Institutions

The Tories, Reform along with the entire right-wing media have spent days railing against the idea that Reeves conforms to the caricature of left-wing finance ministers, taxing strivers to fund the workshy. Party MPs are applauding her budget as a relief for their social concerns, protecting the disadvantaged. Each group are completely mistaken: The Chancellor's budget was primarily aimed at asset managers, speculative capital and participants within the financial markets.

Downing Street could present a compelling argument in its defence. The margins from the OBR were deemed insufficient for comfort, especially considering lenders charge the UK the greatest borrowing cost of all G7 developed nations – exceeding that of France, which lost its leader, higher than Japan that carries far greater debt. Combined with the measures to cap fuel bills, prescription charges as well as train fares, Starmer together with Reeves argue this budget enables the Bank of England to reduce interest rates.

It's understandable that 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 "weaponised" financial markets as a tool of control against her own party and the electorate. It's the reason Reeves cannot resign, regardless of which promises she breaks. It's the reason Labour MPs must knuckle down and vote that cut billions from social security, just as Starmer promised recently.

A Lack of Statecraft and a Broken Pledge

What is absent here is any sense of strategic governance, of harnessing the finance ministry and the central bank to forge a fresh understanding with markets. Missing too is innate understanding of voters,