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This accusation carries significant weight: that Rachel Reeves may have misled Britons, frightening them to accept massive extra taxes which would be funneled into increased welfare payments. While hyperbolic, this isn't typical political bickering; this time, the consequences could be damaging. A week ago, detractors of Reeves and Keir Starmer were labeling their budget "a mess". Today, it's branded as lies, with Kemi Badenoch demanding Reeves to step down.

This serious charge requires straightforward responses, so here is my view. Has the chancellor tell lies? On the available evidence, apparently not. There were no whoppers. But, despite Starmer's yesterday's comments, that doesn't mean there is no issue here and we can all move along. Reeves did misinform the public about the factors shaping her choices. Was this all to channel cash towards "benefits street", like the Tories assert? No, as the figures demonstrate this.

A Standing Takes Another Blow, Yet Truth Must Prevail

The Chancellor has sustained a further blow to her reputation, but, should facts continue to have anything to do with politics, Badenoch should call off her lynch mob. Perhaps the stepping down yesterday of the Office for Budget Responsibility (OBR) chief, Richard Hughes, due to the unauthorized release of its internal documents will quench Westminster's appetite for scandal.

Yet the true narrative is far stranger than the headlines indicate, extending broader and deeper beyond the careers of Starmer and his class of '24. Fundamentally, this is a story concerning what degree of influence you and I get over the running of our own country. And it concern everyone.

Firstly, on to Brass Tacks

After the OBR published last Friday a portion of the forecasts it shared with Reeves while she wrote the red book, the shock was instant. Not only had the OBR not done such a thing before (described as an "rare action"), its numbers seemingly went against the chancellor's words. Even as rumors from Westminster were about the grim nature of the budget would have to be, the watchdog's predictions were improving.

Take the government's so-called "unbreakable" fiscal rule, stating by 2030 daily spending on hospitals, schools, and the rest would be wholly paid for by taxes: in late October, the watchdog calculated it would barely be met, albeit only by a tiny margin.

Several days later, Reeves held a press conference 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 primary cause being gloomy numbers provided by the OBR, specifically its finding suggesting the UK had become less productive, putting more in but yielding less.

And lo! It happened. Notwithstanding what Telegraph editorials and Tory broadcast rounds implied recently, this is essentially what happened during the budget, which was significant, harsh, and grim.

The Misleading Alibi

The way in which Reeves deceived us concerned her justification, since these OBR forecasts did not force her hand. She could have made different options; she might have provided alternative explanations, even during the statement. Before last year's election, Starmer promised precisely this kind of public influence. "The promise of democracy. The strength of the vote. The possibility for national renewal."

One year later, and it is a lack of agency that jumps out in Reeves's breakfast speech. The first Labour chancellor for a decade and a half casts herself as an apolitical figure buffeted by factors beyond her control: "In the context of the persistent challenges on our productivity … any finance minister of any party would be standing here today, facing the decisions that I face."

She certainly make a choice, just not the kind Labour cares to broadcast. Starting April 2029 UK workers as well as businesses will be contributing another £26bn annually in taxes – but the majority of this will not be funding better hospitals, public services, nor happier lives. Regardless of what bilge is spouted by Nigel Farage, Badenoch and their allies, it isn't being lavished upon "benefits street".

Where the Cash Actually Ends Up

Rather than being spent, more than 50% of the extra cash will in fact provide Reeves cushion against her own fiscal rules. About 25% is allocated to covering the government's own U-turns. Examining the watchdog's figures and being as generous as possible to Reeves, a mere 17% of the taxes will fund genuinely additional spending, for example scrapping the two-child cap on child benefit. Removing it "costs" the Treasury only £2.5bn, because it was always an act of theatrical cruelty from George Osborne. A Labour government could and should have binned it in its first 100 days.

The True Audience: Financial Institutions

The Tories, Reform along with the entire right-wing media have spent days barking about how Reeves conforms to the caricature of Labour chancellors, soaking strivers to spend on the workshy. Labour backbenchers have been applauding her budget for being a relief to their troubled consciences, safeguarding the most vulnerable. Each group are completely mistaken: The Chancellor's budget was primarily targeted towards investment funds, hedge funds and participants within the financial markets.

Downing Street can make a compelling argument in its defence. The margins from the OBR were insufficient for comfort, especially given that lenders demand from the UK the highest interest rate of all G7 rich countries – higher than France, that recently 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 together with Reeves can say this budget allows the Bank of England to reduce interest rates.

It's understandable why those wearing red rosettes might not frame it in such terms next time they visit #Labourdoorstep. As one independent adviser for Downing Street says, Reeves has effectively "utilised" financial markets as a tool of discipline over her own party and the electorate. This is why the chancellor cannot resign, no matter what pledges she breaks. It's why Labour MPs will have to fall into line and support measures to take billions off social security, as Starmer indicated recently.

A Lack of Statecraft and a Broken Promise

What's missing here is the notion of strategic governance, of mobilising the finance ministry and the Bank to reach a new accommodation with investors. Missing too is innate understanding of voters,