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The charge is a serious one: that Rachel Reeves may have deceived the British public, frightening them into accepting massive extra taxes which would be funneled into higher welfare payments. While exaggerated, this is not usual Westminster bickering; this time, the consequences are more serious. Just last week, critics of Reeves alongside Keir Starmer had been labeling their budget "uncoordinated". Today, it is branded as lies, and Kemi Badenoch calling for the chancellor's resignation.

This grave charge requires clear responses, therefore let me provide my assessment. Has the chancellor lied? On current evidence, no. She told no whoppers. However, notwithstanding Starmer's yesterday's comments, that doesn't mean there's nothing to see and we should move on. The Chancellor did misinform the public regarding the factors shaping her decisions. Was this all to funnel cash towards "benefits street", like the Tories claim? No, as the figures prove it.

A Reputation Takes A Further Hit, Yet Truth Should Prevail

The Chancellor has sustained another hit to her reputation, however, should facts continue to matter in politics, Badenoch should call off her attack dogs. Perhaps the resignation recently of OBR head, Richard Hughes, due to the unauthorized release of its internal documents will satisfy SW1's thirst for blood.

But the true narrative is much more unusual than the headlines indicate, extending wider and further than the political futures of Starmer and his class of '24. At its heart, herein lies a story concerning what degree of influence the public have over the running of our own country. This should concern you.

First, on to Brass Tacks

After the OBR released recently a portion of the forecasts it shared with Reeves as she prepared the budget, the surprise was immediate. Not merely has the OBR never done such a thing before (an "rare action"), its numbers apparently went against Reeves's statements. Even as leaks from Westminster were about the grim nature of the budget was going to be, the OBR's own predictions were getting better.

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

A few days later, Reeves held a press conference so extraordinary it forced breakfast TV to interrupt its usual fare. Several weeks before the real budget, the nation was warned: taxes would rise, with the main reason cited as gloomy numbers provided by the OBR, specifically its conclusion suggesting the UK had become less efficient, investing more but yielding less.

And lo! It came to pass. Despite what Telegraph editorials combined with Tory media appearances implied recently, this is essentially what happened at the budget, which was significant, harsh, and grim.

The Misleading Justification

Where Reeves deceived us concerned her justification, because those OBR forecasts didn't force her hand. She might have made other choices; she could have provided other reasons, even 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 possibility for national renewal."

A year on, and it's a lack of agency that is evident from Reeves's breakfast speech. The first Labour chancellor in 15 years portrays herself to be a technocrat buffeted by forces beyond her control: "In the context of the long-term challenges on our productivity … any chancellor of any party would be in this position today, facing the decisions that I face."

She certainly make decisions, only not the kind the Labour party cares to broadcast. Starting April 2029 British workers and businesses are set to be contributing an additional £26bn annually in tax – and most of that will not be spent on better hospitals, new libraries, nor enhanced wellbeing. Whatever bilge is spouted by Nigel Farage, Badenoch and their allies, it isn't being lavished upon "benefits street".

Where the Cash Really Goes

Instead of being spent, over 50% of the additional revenue will instead give Reeves a buffer for her self-imposed fiscal rules. About 25% goes on covering the government's own policy reversals. Reviewing the OBR's calculations and giving maximum benefit of the doubt to a Labour chancellor, a mere 17% of the taxes will go on actual new spending, such as scrapping the two-child cap on child benefit. Removing it "costs" the Treasury only £2.5bn, because it had long been a bit of political theatre by George Osborne. This administration could and should abolished it immediately upon taking office.

The Real Target: The Bond Markets

The Tories, Reform and the entire Blue Pravda have spent days railing against the idea that Reeves fits the caricature of Labour chancellors, taxing strivers to fund the workshy. Labour backbenchers are cheering her budget as balm for their social concerns, safeguarding the disadvantaged. Both sides could be 180-degrees wrong: The Chancellor's budget was largely aimed at asset managers, hedge funds and the others in the bond markets.

The government could present a strong case in its defence. The margins from the OBR were too small to feel secure, particularly given that bond investors charge the UK the highest interest rate of all G7 developed nations – exceeding that of France, that recently lost its leader, higher than Japan which has far greater debt. Combined with the measures to hold down fuel bills, prescription charges as well as train fares, Starmer together with Reeves argue this budget enables the central bank to cut its key lending rate.

You can see that those folk with red rosettes may choose not to couch it this way when they're on #Labourdoorstep. According to a consultant to Downing Street says, Reeves has "utilised" the bond market to act as an instrument of discipline against her own party and the electorate. This is the reason Reeves can't resign, no matter what promises are broken. It is also why Labour MPs must fall into line and vote to take billions off social security, just as Starmer promised yesterday.

A Lack of Political Vision and an Unfulfilled Pledge

What's missing from this is the notion of strategic governance, of harnessing the finance ministry and the central bank to forge a new accommodation with markets. Missing too is innate understanding of voters,