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The accusation represents a grave matter: suggesting Rachel Reeves has lied to the British public, scaring them to accept massive extra taxes which could be funneled into increased welfare payments. While hyperbolic, this is not typical Westminster sparring; this time, the stakes are more serious. Just last week, detractors of Reeves and Keir Starmer had been labeling their budget "disorderly". Now, it's branded as lies, and Kemi Badenoch calling for the chancellor's resignation.

This grave charge requires clear answers, therefore here is my assessment. Did the chancellor tell lies? On the available evidence, no. She told no major untruths. But, despite Starmer's recent comments, it doesn't follow that there is nothing to see and we can all move along. Reeves did misinform the public regarding the factors shaping her decisions. Was this all to channel cash towards "welfare recipients", as the Tories assert? No, and the numbers demonstrate this.

A Reputation Sustains Another Blow, But Facts Must Win Out

Reeves has sustained a further blow to her standing, but, if facts continue to have anything to do with politics, Badenoch should stand down her attack dogs. Perhaps the stepping down recently of OBR head, Richard Hughes, over the leak of its own documents will satisfy SW1's appetite for scandal.

But the real story is far stranger than the headlines suggest, extending broader and deeper beyond the political futures of Starmer and his 2024 intake. At its heart, herein lies a story concerning what degree of influence the public get over the governance of our own country. And it should worry you.

Firstly, on to the Core Details

After the OBR published recently a portion of the projections it provided to Reeves as she wrote the budget, the surprise was instant. Not only has the OBR never acted this way before (an "exceptional move"), its figures apparently contradicted Reeves's statements. Even as leaks from Westminster were about how bleak the budget was going to be, the OBR's own predictions were improving.

Consider the Treasury's so-called "iron-clad" fiscal rule, that by 2030 daily spending on hospitals, schools, and the rest must be completely funded by taxes: at the end of October, the watchdog reckoned it would barely be met, albeit only by a minuscule margin.

A few days later, Reeves gave a press conference so extraordinary it forced breakfast TV to break from its usual fare. Weeks prior to the real budget, the country was warned: taxes were going up, and the primary cause cited as pessimistic numbers from the OBR, specifically its finding that the UK was less productive, investing more but getting less out.

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

The Deceptive Justification

The way in which Reeves misled us was her justification, because those OBR forecasts did not force her hand. She could have chosen other choices; she might have provided alternative explanations, including on budget day itself. Prior to last year's election, Starmer promised exactly such people power. "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 from Reeves's breakfast speech. The first Labour chancellor in 15 years casts herself to be a technocrat at the mercy of factors beyond her control: "Given the circumstances of the persistent challenges on our productivity … any finance minister of any party would be standing here today, confronting the decisions that I face."

She did make a choice, just not the kind the Labour party cares to publicize. From April 2029 British workers as well as businesses are set to be contributing another £26bn a year in tax – and most of that will not go towards spent on better hospitals, public services, nor happier lives. Regardless of what bilge comes from Nigel Farage, Badenoch and their allies, it isn't being lavished upon "benefits street".

Where the Money Actually Ends Up

Instead of going on services, more than 50% of this additional revenue will in fact give Reeves cushion against her self-imposed budgetary constraints. Approximately 25% goes on paying for the government's own U-turns. Reviewing 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 a mere £2.5bn, as it was always a bit of theatrical cruelty from George Osborne. This administration could and should have binned it in its first 100 days.

The True Audience: The Bond Markets

The Tories, Reform along with the entire right-wing media have been railing against how Reeves fits the stereotype of left-wing finance ministers, soaking strivers to spend on shirkers. Labour backbenchers are cheering her budget for being a relief to their social concerns, protecting the most vulnerable. Each group are 180-degrees wrong: Reeves's budget was largely aimed at asset managers, speculative capital and the others in the bond markets.

The government could present a compelling argument for itself. The forecasts from the OBR were insufficient for comfort, particularly considering bond investors charge the UK the highest interest rate of all G7 developed nations – higher than France, that recently lost its leader, higher than Japan that carries way more debt. Coupled with our policies to cap fuel bills, prescription charges and train fares, Starmer together with Reeves argue this budget allows the central bank to cut interest rates.

You can see why those folk with red rosettes may choose not to couch it in such terms when they're on #Labourdoorstep. According to a consultant to Downing Street puts it, Reeves has "weaponised" the bond market as a tool of control against Labour MPs and the electorate. This is why Reeves can't resign, no matter what promises she breaks. It's the reason Labour MPs will have to knuckle down and vote that cut billions from social security, as Starmer indicated recently.

Missing Political Vision and an Unfulfilled Pledge

What's missing here is any sense of strategic governance, of mobilising the finance ministry and the central bank to forge a fresh understanding with markets. Missing too is innate understanding of voters,