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The charge carries significant weight: suggesting Rachel Reeves has misled UK citizens, scaring them into accepting billions in additional taxes which could be used for higher benefits. However hyperbolic, this isn't usual political bickering; this time, the stakes are more serious. A week ago, critics aimed at Reeves alongside Keir Starmer were labeling their budget "disorderly". Now, it's denounced as falsehoods, with Kemi Badenoch calling for the chancellor's resignation.

This serious charge requires straightforward answers, therefore here is my assessment. Did the chancellor tell lies? Based on the available evidence, apparently not. There were no major untruths. But, despite Starmer's recent comments, that doesn't mean there is nothing to see and we can all move along. Reeves did mislead the public about the factors shaping her choices. Was it to funnel cash towards "welfare recipients", like the Tories assert? No, and the numbers demonstrate it.

A Reputation Takes A Further Blow, Yet Truth Should Prevail

The Chancellor has taken a further hit to her standing, however, if facts still have anything to do with politics, Badenoch should call off her lynch mob. Maybe the resignation yesterday of OBR head, Richard Hughes, over the unauthorized release of its own documents will quench Westminster's appetite for scandal.

But the real story is far stranger than the headlines indicate, and stretches broader and deeper beyond the careers of Starmer and the class of '24. At its heart, herein lies a story concerning what degree of influence you and I have over the governance of our own country. This should concern you.

Firstly, to Brass Tacks

After the OBR released last Friday some of the projections it shared with Reeves as she prepared the budget, the shock was immediate. Not merely had the OBR not done such a thing before (an "unusual step"), its figures seemingly contradicted Reeves's statements. Even as rumors from Westminster suggested the grim nature of the budget was going to be, the OBR's own predictions were getting better.

Take the government's most "iron-clad" rule, that by 2030 day-to-day spending for hospitals, schools, and the rest would be completely funded by taxes: in late October, the watchdog reckoned it would just about be met, albeit only by a minuscule margin.

Several days later, Reeves gave a press conference so extraordinary it forced breakfast TV to break from its regular schedule. Several weeks before the actual budget, the nation was put on alert: taxes would rise, with the main reason cited as gloomy numbers from the OBR, specifically its conclusion suggesting the UK had become less productive, investing more but getting less out.

And lo! It happened. Notwithstanding what Telegraph editorials combined with Tory media appearances suggested over the weekend, this is essentially what happened during the budget, that proved to be significant, harsh, and grim.

The Deceptive Justification

Where Reeves misled us was her alibi, since these OBR forecasts didn't compel her actions. She could have made different options; she might have provided other reasons, even during the statement. Prior to last year's election, Starmer pledged precisely this kind of people power. "The hope of democracy. The power of the vote. The potential for national renewal."

A year on, and it's powerlessness that jumps out in Reeves's breakfast speech. The first Labour chancellor for a decade and a half portrays herself to be an apolitical figure buffeted by forces beyond her control: "Given the circumstances of the long-term challenges on our productivity … any chancellor of any political stripe would be standing here today, facing the choices that I face."

She did make decisions, only not one Labour wishes to broadcast. From April 2029 British workers and businesses will be paying another £26bn annually in tax – but most of that will not be funding better hospitals, new libraries, or enhanced wellbeing. Whatever bilge is spouted by Nigel Farage, Badenoch and their allies, it isn't getting splashed on "benefits street".

Where the Cash Really Goes

Instead of going on services, more than 50% of the extra cash will in fact provide Reeves cushion against her own budgetary constraints. About 25% goes on covering the administration's U-turns. Examining the watchdog's figures and giving maximum benefit of the doubt to Reeves, only 17% of the taxes will go on genuinely additional spending, for example abolishing the two-child cap 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 immediately upon taking office.

The Real Target: Financial Institutions

The Tories, Reform along with all of Blue Pravda have been railing against the idea that Reeves conforms to the caricature of Labour chancellors, soaking strivers to spend on the workshy. Party MPs are applauding her budget for being a relief to their troubled consciences, safeguarding the most vulnerable. Both sides could be completely mistaken: The Chancellor's budget was largely targeted towards investment funds, speculative capital and the others in the financial markets.

Downing Street could present a strong case in its defence. The forecasts provided by the OBR were deemed too small for comfort, particularly considering lenders demand from the UK the greatest borrowing cost of all G7 rich countries – exceeding that of France, which lost its leader, higher than Japan which has way more debt. Combined with our measures to cap fuel bills, prescription charges and train fares, Starmer and Reeves argue their plan enables the Bank of England to reduce its key lending rate.

You can see why those wearing red rosettes may choose not to couch it this way next time they visit the doorstep. According to a consultant for Downing Street puts it, Reeves has effectively "weaponised" financial markets to act as an instrument of discipline over her own party and the voters. It's the reason Reeves cannot resign, no matter what promises she breaks. It is also why Labour MPs will have to fall into line and support measures to take billions off social security, just as Starmer indicated recently.

Missing Statecraft , a Broken Promise

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