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The allegation carries significant weight: that Rachel Reeves has misled the British public, frightening them to accept massive extra taxes that would be used for increased welfare payments. While hyperbolic, this is not usual political bickering; this time, the stakes are more serious. Just last week, critics aimed at Reeves and Keir Starmer had been labeling their budget "uncoordinated". Now, it is denounced as falsehoods, with Kemi Badenoch demanding the chancellor's resignation.

This serious accusation requires straightforward answers, so here is my view. Has the chancellor lied? Based on current evidence, apparently not. She told no major untruths. But, notwithstanding Starmer's recent remarks, that doesn't mean there's no issue here and we should move on. The Chancellor did mislead the public about the factors informing her choices. Was this all to channel cash to "welfare recipients", like the Tories assert? Certainly not, and the numbers demonstrate it.

A Reputation Sustains Another Hit, But Facts Must Prevail

Reeves has sustained another hit to her reputation, however, should facts still matter in politics, Badenoch should call off her attack dogs. Perhaps the stepping down recently of the Office for Budget Responsibility (OBR) chief, Richard Hughes, over the unauthorized release of its internal documents will quench SW1's thirst for blood.

But the true narrative is much more unusual compared to media reports indicate, and stretches broader and deeper than the political futures of Starmer and the 2024 intake. At its heart, this is a story about how much say the public have over the governance of the nation. And it should worry you.

Firstly, to the Core Details

When the OBR published recently some of the projections it provided to Reeves as she prepared the budget, the shock was instant. Not only has the OBR not done such a thing before (an "rare action"), its numbers seemingly went against Reeves's statements. Even as rumors from Westminster were about how bleak the budget was going to be, the watchdog's predictions were getting better.

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

Several 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 put on alert: taxes were going up, with the main reason cited as gloomy numbers provided by the OBR, specifically its finding suggesting the UK had become less efficient, putting more in but getting less out.

And lo! It came to pass. Notwithstanding the implications from Telegraph editorials combined with Tory media appearances implied over the weekend, this is essentially what happened at the budget, that proved to be big and painful and bleak.

The Deceptive Justification

The way in which Reeves misled us concerned her alibi, since these OBR forecasts did not compel her actions. She might have chosen different options; she could have provided alternative explanations, even on budget day itself. Prior to last year's election, Starmer promised exactly such public influence. "The hope of democracy. The power of the vote. The potential for national renewal."

A year on, 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 a technocrat buffeted by factors outside her influence: "Given the circumstances of the persistent challenges on our productivity … any chancellor of any party would be in this position today, confronting the decisions that I face."

She certainly make a choice, just not the kind the Labour party wishes to broadcast. Starting April 2029 British workers as well as businesses are set to be contributing another £26bn a year in tax – but most of that will not be spent on better hospitals, public services, nor enhanced wellbeing. Whatever nonsense is spouted by Nigel Farage, Badenoch and others, it isn't getting splashed on "welfare claimants".

Where the Money Actually Ends Up

Rather than going on services, over 50% of this additional revenue will instead provide Reeves a buffer against her self-imposed fiscal rules. Approximately 25% goes on paying for the government's own policy reversals. Examining the OBR's calculations and being as generous as possible to Reeves, a mere 17% of the tax take will fund actual new spending, for example scrapping the limit on child benefit. Its abolition "will cost" the Treasury a mere £2.5bn, because it was always a bit of political theatre by George Osborne. A Labour government should have abolished it immediately upon taking office.

The Real Target: Financial Institutions

The Tories, Reform and all of Blue Pravda have been railing against the idea that Reeves conforms to the caricature of left-wing finance ministers, 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 could be completely mistaken: Reeves's budget was largely targeted towards investment funds, speculative capital and the others in the bond markets.

The government could present a compelling argument for itself. The margins from the OBR were deemed too small for comfort, especially given that lenders demand from the UK the greatest borrowing cost among G7 developed nations – exceeding that of France, that recently lost a prime minister, higher than Japan which has way more debt. Combined with the measures to cap fuel bills, prescription charges and train fares, Starmer together with Reeves argue their plan enables the Bank of England to reduce interest rates.

It's understandable that those folk with red rosettes might not couch it this way when they're on the doorstep. As one independent adviser for Downing Street says, Reeves has "weaponised" financial markets to act as a tool of control against her own party and the voters. It's why the chancellor cannot resign, no matter what pledges are broken. It's the reason Labour MPs must fall into line and vote that cut billions from social security, as Starmer indicated recently.

A Lack of Political Vision , an Unfulfilled Pledge

What's missing from this is the notion of strategic governance, of harnessing the finance ministry and the Bank to reach a new accommodation with investors. Also absent is innate understanding of voters,