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This charge represents a grave matter: suggesting Rachel Reeves has lied to UK citizens, spooking them to accept billions in additional taxes which could be funneled into increased welfare payments. However exaggerated, this isn't typical Westminster sparring; on this occasion, the stakes are more serious. A week ago, critics of Reeves and Keir Starmer were calling their budget "a shambles". Today, it is branded as falsehoods, with Kemi Badenoch calling for the chancellor's resignation.

Such a grave accusation demands clear responses, therefore here is my assessment. Did the chancellor been dishonest? Based on the available evidence, no. She told no major untruths. But, despite Starmer's yesterday's remarks, it doesn't follow that there's no issue here and we can all move along. The Chancellor did mislead the public regarding the factors shaping her choices. Was this all to funnel cash towards "benefits street", as the Tories assert? No, as the figures prove this.

A Reputation Takes A Further Blow, Yet Truth Must Win Out

The Chancellor has taken another hit to her reputation, however, if facts still have anything to do with politics, Badenoch should call off her attack dogs. Maybe the stepping down recently of the Office for Budget Responsibility (OBR) chief, Richard Hughes, over the unauthorized release of its internal documents will satisfy SW1's thirst for blood.

But the true narrative is far stranger compared to the headlines indicate, extending broader and deeper than the careers of Starmer and the 2024 intake. At its heart, this is a story about how much say the public have in the running of the nation. And it should worry you.

Firstly, to the Core Details

When the OBR released last Friday a portion of the forecasts it shared with Reeves as she wrote the budget, the shock was instant. Not merely has the OBR not acted this way before (an "unusual step"), its figures apparently went against Reeves's statements. While leaks from Westminster suggested how bleak the budget would have to be, the watchdog's predictions were improving.

Consider the government's most "unbreakable" rule, stating by 2030 day-to-day spending on hospitals, schools, and other services would be completely funded by taxes: at the end of 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 unprecedented it forced morning television to interrupt its usual fare. Weeks before the actual budget, the nation was warned: taxes would rise, with the primary cause being pessimistic numbers provided by the OBR, in particular its conclusion suggesting the UK was less productive, putting more in but getting less out.

And so! It came to pass. Notwithstanding the implications from Telegraph editorials and Tory media appearances implied recently, that is essentially what happened at the budget, that proved to be significant, harsh, and grim.

The Misleading Alibi

The way in which Reeves misled us concerned her alibi, because these OBR forecasts didn't compel her actions. She could have made different options; she might have given alternative explanations, even on budget day itself. Before last year's election, Starmer promised exactly such public influence. "The hope of democracy. The strength of the vote. The possibility for national renewal."

A year on, and it's powerlessness that is evident from Reeves's pre-budget speech. Our first Labour chancellor in 15 years portrays herself to be an apolitical figure at the mercy of factors outside her influence: "In the context of the long-term challenges on our productivity … any chancellor of any party would be standing here today, facing the choices that I face."

She certainly make decisions, just not the kind Labour wishes to broadcast. From April 2029 UK workers and businesses will be paying an additional £26bn annually in taxes – but most of that will not be spent on better hospitals, public services, or happier lives. Whatever bilge is spouted by Nigel Farage, Badenoch and their allies, it isn't getting splashed on "welfare claimants".

Where the Money Actually Ends Up

Instead of going on services, over 50% of the extra cash will in fact provide Reeves a buffer against her own fiscal rules. Approximately 25% goes on paying for the administration's U-turns. Examining the watchdog's figures and giving maximum benefit of the doubt to Reeves, only 17% of the tax take will fund genuinely additional spending, for example abolishing the limit on child benefit. Removing it "costs" the Treasury a mere £2.5bn, as it had long been a bit of theatrical cruelty from George Osborne. A Labour government could and should have binned it in its first 100 days.

The Real Target: Financial Institutions

The Tories, Reform and the entire right-wing media have been railing against how Reeves fits the stereotype of Labour chancellors, taxing strivers to fund shirkers. Party MPs have been applauding her budget for being a relief to their social concerns, safeguarding the disadvantaged. Both sides could be completely mistaken: Reeves's budget was primarily aimed at asset managers, hedge funds and the others in the financial markets.

The government could present a compelling argument in its defence. The margins from the OBR were too small for comfort, especially considering lenders charge the UK the highest interest rate of all G7 developed nations – exceeding that of France, which lost a prime minister, and exceeding Japan which has far greater debt. Combined with the policies to cap fuel bills, prescription charges and train fares, Starmer together with Reeves argue this budget allows the Bank of England to cut interest rates.

You can see that those folk with Labour badges may choose not to frame it this way next time they visit #Labourdoorstep. As one independent adviser for Downing Street puts it, Reeves has "utilised" the bond market to act as an instrument of control against her own party and the voters. This is why Reeves cannot resign, no matter what promises she breaks. It is also why Labour MPs must knuckle down and vote to take billions off social security, just as Starmer indicated yesterday.

Missing Political Vision , a Broken Promise

What is absent here is any sense of strategic governance, of harnessing the Treasury and the central bank to forge a new accommodation with markets. Also absent is any innate understanding of voters,