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This accusation carries significant weight: that Rachel Reeves may have lied to the British public, scaring them into accepting massive extra taxes that would be spent on higher benefits. However exaggerated, this is not typical political bickering; this time, the stakes are more serious. A week ago, critics aimed at Reeves and Keir Starmer had been labeling their budget "a mess". Today, it's denounced as lies, and Kemi Badenoch demanding the chancellor to quit.

This grave charge requires straightforward answers, so let me provide my assessment. Did the chancellor lied? Based on the available information, no. She told no blatant falsehoods. But, despite Starmer's recent remarks, it doesn't follow that there's no issue here and we should move on. Reeves did misinform the public regarding the considerations informing her decisions. Was this all to channel cash towards "welfare recipients", as the Tories claim? No, as the figures demonstrate it.

A Standing Takes Another Blow, But Facts Must Prevail

The Chancellor has sustained a further blow to her standing, however, if facts continue to have anything to do with politics, Badenoch ought to call off her attack dogs. Maybe the resignation recently of OBR head, Richard Hughes, over the leak of its internal documents will quench SW1's appetite for scandal.

Yet the real story is much more unusual compared to media reports suggest, extending wider and further than the political futures of Starmer and the class of '24. At its heart, herein lies a story about what degree of influence the public have in the governance of our own country. And it should worry you.

First, to the Core Details

When the OBR released recently a portion of the projections it provided to Reeves while she prepared the red book, the surprise was instant. Not only had the OBR never acted this way before (an "exceptional move"), its numbers seemingly contradicted the chancellor's words. Even as rumors from Westminster were about the grim nature of the budget was going to be, the OBR's own predictions were getting better.

Take the government's most "iron-clad" fiscal rule, stating by 2030 daily spending for hospitals, schools, and the rest must be completely funded by taxes: in late October, the OBR calculated it would just about be met, albeit only by a minuscule margin.

Several days later, Reeves gave a media briefing so unprecedented it forced morning television to break from its regular schedule. Weeks prior to the real budget, the country was warned: taxes would rise, and the main reason cited as pessimistic numbers provided by the OBR, in particular its conclusion that the UK was less productive, investing more but yielding less.

And so! It happened. Notwithstanding what Telegraph editorials and Tory broadcast rounds suggested recently, this is essentially what transpired at the budget, which was big and painful and bleak.

The Deceptive Justification

The way in which Reeves misled us was her justification, because those OBR forecasts didn't force her hand. She could have chosen other choices; she could have given alternative explanations, including during the statement. Before last year's election, Starmer promised precisely this kind of people power. "The hope of democracy. The power of the vote. The potential for national renewal."

One year later, yet 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 an apolitical figure buffeted by forces outside her influence: "Given the circumstances of the persistent challenges with our productivity … any finance minister of any party would be standing here today, confronting the choices that I face."

She did make decisions, only not one the Labour party wishes to broadcast. Starting April 2029 UK workers as well as businesses are set to be paying an additional £26bn a year in taxes – and the majority of this will not go towards spent on better hospitals, new libraries, nor enhanced wellbeing. Whatever bilge comes from Nigel Farage, Badenoch and others, it isn't being lavished upon "welfare claimants".

Where the Money Really Goes

Instead of going on services, over 50% of this extra cash will instead give Reeves cushion against her self-imposed fiscal rules. Approximately 25% is allocated to covering the administration's policy reversals. Reviewing the OBR's calculations and being as generous as possible to a Labour chancellor, a mere 17% of the taxes will go on actual new spending, for example scrapping the two-child cap on child benefit. Its abolition "costs" the Treasury a mere £2.5bn, because it had long been an act of theatrical cruelty from George Osborne. A Labour government could and should have binned it immediately upon taking office.

The Real Target: The Bond Markets

Conservatives, Reform along with all of right-wing media have spent days barking about the idea that Reeves conforms to the stereotype of Labour chancellors, taxing hard workers to spend on shirkers. Labour backbenchers have been cheering her budget as balm to their troubled consciences, protecting the most vulnerable. Both sides are 180-degrees wrong: The Chancellor's budget was largely aimed at investment funds, hedge funds and the others in the financial markets.

Downing Street can make a compelling argument in its defence. The forecasts from the OBR were insufficient to feel secure, especially given that bond investors demand from the UK the greatest borrowing cost among G7 developed nations – higher than France, which lost its leader, and exceeding Japan that carries far greater debt. Coupled with the measures to hold down fuel bills, prescription charges and train fares, Starmer and Reeves argue this budget enables the Bank of England to cut interest rates.

It's understandable that those wearing Labour badges may choose not to frame it in such terms when they're on the doorstep. According to one independent adviser for Downing Street puts it, Reeves has effectively "weaponised" the bond market as a tool of control against Labour MPs and the electorate. It's the reason Reeves can't resign, regardless of which pledges are broken. It is also the reason Labour MPs will have to knuckle down and vote to take billions off social security, just as Starmer promised recently.

Missing Statecraft and an Unfulfilled Promise

What's missing here is any sense of statecraft, of mobilising the Treasury and the Bank to reach a new accommodation with investors. Also absent is intuitive knowledge of voters,