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The accusation represents a grave matter: suggesting Rachel Reeves has misled UK citizens, scaring them into accepting massive extra taxes that would be used for increased welfare payments. While hyperbolic, this is not typical political bickering; this time, the consequences could be damaging. Just last week, critics aimed at Reeves alongside Keir Starmer had been labeling their budget "disorderly". Today, it's branded as lies, with Kemi Badenoch calling for Reeves to step down.

This serious accusation demands clear answers, therefore let me provide my view. Has the chancellor been dishonest? On the available evidence, no. She told no major untruths. However, despite Starmer's recent comments, it doesn't follow that there is nothing to see and we should move on. Reeves did mislead the public about the factors informing her choices. Was it to channel cash to "welfare recipients", like the Tories claim? No, and the figures prove it.

A Reputation Sustains A Further Blow, But Facts Must Prevail

Reeves has taken another blow to her standing, however, if facts still have anything to do with politics, Badenoch ought to call off her lynch mob. Maybe the resignation recently of OBR head, Richard Hughes, due to the unauthorized release of its internal documents will satisfy SW1's thirst for blood.

Yet the true narrative is much more unusual than media reports suggest, and stretches wider and further than the careers of Starmer and the class of '24. Fundamentally, this is an account about what degree of influence you and I get over the governance of our own country. This should concern you.

Firstly, on to Brass Tacks

When the OBR published recently some of the projections it shared with Reeves as she wrote the budget, the surprise was instant. Not merely has the OBR never acted this way before (described as an "rare action"), its figures seemingly contradicted Reeves's statements. Even as rumors from Westminster suggested the grim nature of the budget would have to be, the OBR's own predictions were getting better.

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

A few days later, Reeves held a media briefing so extraordinary that it caused morning television to interrupt its usual fare. Several weeks prior to the real budget, the nation was warned: taxes were going up, with the primary cause being pessimistic numbers from the OBR, specifically its finding that the UK had become less productive, putting more in but getting less out.

And lo! It happened. Despite what Telegraph editorials and Tory broadcast rounds suggested 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 these OBR forecasts didn't force her hand. She might have made different options; she might have given alternative explanations, even on budget day itself. Prior to the recent election, Starmer pledged exactly such public influence. "The promise of democracy. The strength of the vote. The possibility for national renewal."

One year later, yet it is powerlessness that is evident from Reeves's pre-budget speech. The first Labour chancellor for a decade and a half casts herself to be a technocrat buffeted by factors outside her influence: "Given the circumstances of the long-term challenges on our productivity … any finance minister of any political stripe would be standing here today, facing the decisions that I face."

She certainly make decisions, just not one the Labour party wishes to broadcast. Starting April 2029 UK workers as well as businesses will be paying another £26bn a year in taxes – and the majority of this will not be spent on improved healthcare, public services, nor enhanced wellbeing. Whatever nonsense is spouted by Nigel Farage, Badenoch and others, it isn't being lavished upon "welfare claimants".

Where the Money Really Goes

Instead of being spent, more than 50% of the extra cash will in fact provide Reeves cushion for her own budgetary constraints. About 25% goes on covering the government's own U-turns. Examining the OBR's calculations and being as generous as possible to a Labour chancellor, a mere 17% of the taxes will go on actual new spending, such as abolishing the limit on child benefit. Its abolition "costs" the Treasury only £2.5bn, because it had long been a bit of theatrical cruelty from George Osborne. A Labour government should have abolished it in its first 100 days.

The True Audience: Financial Institutions

The Tories, Reform and all of right-wing media have spent days barking about how Reeves fits the stereotype of left-wing finance ministers, soaking strivers to fund shirkers. Labour backbenchers have been cheering her budget for being a relief for their troubled consciences, protecting the disadvantaged. Both sides are 180-degrees wrong: The Chancellor's budget was largely targeted towards investment funds, speculative capital and the others in the bond markets.

Downing Street could present a strong case for itself. The forecasts from the OBR were deemed insufficient for comfort, particularly given that bond investors charge the UK the greatest borrowing cost of all G7 rich countries – higher than France, that recently lost a prime minister, and exceeding Japan which has way more debt. Coupled with the policies to cap fuel bills, prescription charges and train fares, Starmer and Reeves can say this budget enables the Bank of England to cut its key lending rate.

You can see that those folk with Labour badges might not frame it in such terms when they're on the doorstep. As one independent adviser for Downing Street says, Reeves has "utilised" financial markets as a tool of control against her own party and the voters. This is the reason Reeves cannot resign, no matter what promises are broken. It's why Labour MPs will have to knuckle down and support measures to take billions off social security, as Starmer indicated recently.

Missing Statecraft and an Unfulfilled Pledge

What is absent here is any sense of statecraft, of mobilising the finance ministry and the central bank to forge a new accommodation with markets. Also absent is any innate understanding of voters,