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This charge represents a grave matter: suggesting Rachel Reeves has lied to UK citizens, spooking them into accepting billions in additional taxes which would be funneled into increased benefits. However exaggerated, this is not usual Westminster bickering; on this occasion, the stakes are more serious. Just last week, detractors of Reeves and Keir Starmer were calling their budget "uncoordinated". Today, it's branded as falsehoods, and Kemi Badenoch demanding Reeves to step down.

This grave accusation demands straightforward responses, so here is my assessment. Has the chancellor tell lies? Based on the available evidence, apparently not. She told no major untruths. However, notwithstanding Starmer's yesterday's remarks, it doesn't follow that there is no issue here and we should move on. Reeves did mislead the public regarding the factors informing her decisions. Was this all to funnel cash towards "welfare recipients", as the Tories claim? No, and the numbers demonstrate it.

A Standing Takes Another Blow, Yet Truth Should Win Out

Reeves has taken another hit to her standing, but, should facts still have anything to do with politics, Badenoch ought to call off her lynch mob. Maybe the resignation yesterday of OBR head, Richard Hughes, due to the leak of its internal documents will satisfy Westminster's thirst for blood.

But the real story is far stranger compared to media reports indicate, extending wider and further beyond the political futures of Starmer and his class of '24. Fundamentally, herein lies an account about how much say you and I have in the governance of the nation. And it concern everyone.

First, on to Brass Tacks

When the OBR published recently a portion of the projections it shared with Reeves as she wrote the red book, the shock was instant. Not merely had the OBR never acted this way before (described as an "exceptional move"), its figures apparently went against Reeves's statements. Even as rumors from Westminster suggested the grim nature of the budget was going to be, the watchdog's predictions were improving.

Take the Treasury's most "unbreakable" fiscal rule, that by 2030 daily spending on hospitals, schools, and the rest would be completely paid for by taxes: at the end of October, the watchdog reckoned it would just about be met, albeit only by a minuscule margin.

Several days later, Reeves gave a media briefing so extraordinary it forced morning television to break from its usual fare. Weeks before the real budget, the nation was warned: taxes would rise, with the main reason cited as pessimistic numbers provided by the OBR, specifically its finding that the UK had become less productive, investing more but getting less out.

And lo! It happened. Despite the implications from Telegraph editorials and Tory broadcast rounds suggested over the weekend, this is essentially what happened at the budget, that proved to be big and painful and bleak.

The Misleading Justification

The way in which Reeves deceived us was her justification, because those OBR forecasts didn't compel her actions. She could have made other choices; she could have given alternative explanations, even during the statement. Before the recent election, Starmer pledged precisely this kind of people power. "The promise of democracy. The strength of the vote. The potential for national renewal."

A year on, and it's powerlessness that jumps out in Reeves's breakfast speech. Our first Labour chancellor for a decade and a half portrays herself to be a technocrat at the mercy of forces beyond her control: "Given the circumstances of the long-term challenges on our productivity … any chancellor of any party would be standing here today, confronting the choices that I face."

She certainly make decisions, just not one Labour cares to publicize. Starting April 2029 UK workers as well as businesses are set to be contributing an additional £26bn a year in tax – but most of that will not be funding better hospitals, public services, or enhanced wellbeing. Regardless of what nonsense comes from 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 provide Reeves cushion for her own fiscal rules. Approximately 25% goes on paying for the administration's policy reversals. Examining the watchdog's figures and being as generous as possible towards a Labour chancellor, a mere 17% of the tax take will fund actual new spending, such as abolishing the limit on child benefit. Removing it "will cost" the Treasury only £2.5bn, because it had long been a bit of theatrical cruelty by George Osborne. This administration should have abolished it immediately upon taking office.

The Real Target: The Bond Markets

Conservatives, Reform along with all of right-wing media have been railing against the idea that Reeves fits the caricature of Labour chancellors, soaking strivers to fund shirkers. Party MPs have been cheering her budget as balm for their social concerns, safeguarding the most vulnerable. Both sides could be 180-degrees wrong: The Chancellor's budget was primarily aimed at investment funds, speculative capital and participants within the bond markets.

The government can make a compelling argument in its defence. The forecasts provided by the OBR were deemed too small to feel secure, especially considering lenders charge the UK the highest interest rate among G7 rich countries – exceeding that of France, which lost its leader, higher than Japan which has way more debt. Coupled with our policies to cap fuel bills, prescription charges and train fares, Starmer together with Reeves argue this budget enables the Bank of England to reduce its key lending rate.

It's understandable why those wearing Labour badges might not frame it in such terms next time they visit #Labourdoorstep. According to one independent adviser for Downing Street puts it, Reeves has effectively "utilised" financial markets to act as a tool of control against Labour MPs and the electorate. It's the reason the chancellor can't resign, no matter what pledges are broken. It's why Labour MPs will have to knuckle down and support measures that cut billions from social security, just as Starmer indicated recently.

Missing Statecraft and a Broken Promise

What's missing from this is the notion of strategic governance, of harnessing the Treasury and the Bank to reach a new accommodation with investors. Missing too is intuitive knowledge of voters,