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This accusation represents a grave matter: suggesting Rachel Reeves may have misled Britons, frightening them into accepting massive extra taxes that would be spent on higher benefits. While hyperbolic, this isn't usual Westminster sparring; on this occasion, the stakes are more serious. A week ago, detractors of Reeves alongside Keir Starmer had been calling their budget "a shambles". Today, it's branded as lies, and Kemi Badenoch demanding the chancellor to quit.

Such a serious accusation requires clear answers, so let me provide my assessment. Did the chancellor tell lies? On current information, no. She told no major untruths. But, notwithstanding Starmer's yesterday's remarks, that doesn't mean there's nothing to see and we should move on. Reeves did misinform the public about the considerations shaping her decisions. Was this all to channel cash to "benefits street", like the Tories assert? Certainly not, as the numbers prove it.

A Standing Sustains Another Hit, Yet Truth Must Win Out

Reeves has sustained a further hit to her standing, but, should facts still matter in politics, Badenoch should call off her attack dogs. Perhaps the resignation yesterday of OBR head, Richard Hughes, over the unauthorized release of its own documents will satisfy Westminster's thirst for blood.

Yet the real story is far stranger compared to the headlines indicate, and stretches wider and further beyond the political futures of Starmer and the class of '24. At its heart, this is an account concerning how much say the public have over the running of the nation. This should concern you.

First, to the Core Details

When the OBR released recently some of the forecasts it provided to Reeves while she prepared the budget, the shock was instant. Not only has the OBR not done such a thing before (an "unusual step"), its figures seemingly contradicted the chancellor's words. Even as rumors from Westminster were about how bleak the budget would have to be, the watchdog's predictions were improving.

Take the government's most "iron-clad" rule, stating by 2030 day-to-day spending for hospitals, schools, and the rest would be wholly funded by taxes: at the end of October, the OBR reckoned this would barely be met, albeit by a tiny margin.

Several days later, Reeves held a media briefing so unprecedented that it caused breakfast TV to break from its usual fare. Several weeks before the actual budget, the nation was put on alert: taxes were going up, and the primary cause cited as pessimistic numbers provided by the OBR, specifically its conclusion suggesting the UK was less efficient, putting more in but getting less out.

And lo! It happened. Notwithstanding what Telegraph editorials combined with Tory broadcast rounds implied recently, that is essentially what transpired during the budget, that proved to be significant, harsh, and grim.

The Misleading Alibi

Where Reeves misled us concerned her justification, since these OBR forecasts did not compel her actions. She could have made other choices; she might have provided other reasons, even during the statement. Prior to the recent election, Starmer promised precisely this kind of 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 is evident in Reeves's breakfast speech. The first Labour chancellor for a decade and a half casts herself to be an apolitical figure at the mercy of factors outside her influence: "In the context of the long-term challenges on our productivity … any chancellor of any party would be in this position today, confronting the choices that I face."

She did make a choice, just not the kind the Labour party cares to publicize. From April 2029 British workers as well as businesses are set to be paying another £26bn annually in taxes – but the majority of this will not go towards funding improved healthcare, public services, nor happier lives. Regardless of what nonsense comes from Nigel Farage, Badenoch and their allies, it is not being lavished upon "welfare claimants".

Where the Cash Really Goes

Instead of being spent, over 50% of this additional revenue will instead provide Reeves a buffer for her self-imposed fiscal rules. About 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 taxes will fund actual new spending, such as scrapping the limit on child benefit. Removing it "will cost" the Treasury a mere £2.5bn, because it had long been an act of theatrical cruelty from George Osborne. A Labour government could and should have binned it immediately upon taking office.

The Real Target: Financial Institutions

The Tories, Reform and the entire Blue Pravda have been railing against the idea that Reeves fits the stereotype of left-wing finance ministers, taxing strivers to spend on the workshy. Labour backbenchers are cheering her budget as balm to their troubled consciences, safeguarding the most vulnerable. Both sides are completely mistaken: The Chancellor's budget was largely aimed at investment funds, hedge funds and participants within the bond markets.

The government could present a compelling argument for itself. The forecasts from the OBR were insufficient to feel secure, especially given that lenders demand from the UK the highest interest rate of all G7 developed nations – higher than France, that recently lost its leader, and exceeding Japan which has way more debt. Combined with our policies to cap fuel bills, prescription charges and train fares, Starmer and Reeves argue their plan allows the Bank of England to cut interest rates.

You can see that those wearing Labour badges might not couch it in such terms when they're on the doorstep. According to a consultant to Downing Street puts it, Reeves has effectively "utilised" financial markets as an instrument of discipline over Labour MPs and the electorate. This is why the chancellor cannot resign, no matter what promises are broken. It is also why Labour MPs must fall into line and support measures to take billions off social security, as Starmer indicated yesterday.

A Lack of Statecraft , a Broken Promise

What's missing here is the notion of statecraft, of harnessing the Treasury and the Bank to reach a fresh understanding with markets. Also absent is innate understanding of voters,