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This charge carries significant weight: suggesting Rachel Reeves has lied to the British public, spooking them to accept massive additional taxes that could be used for increased welfare payments. However hyperbolic, this isn't usual Westminster bickering; this time, the stakes are higher. A week ago, detractors aimed at Reeves alongside Keir Starmer were labeling their budget "uncoordinated". Today, it's denounced as lies, with Kemi Badenoch demanding Reeves to step down.

Such a grave charge requires clear responses, so let me provide my view. Did the chancellor been dishonest? On the available evidence, apparently not. There were no whoppers. But, notwithstanding Starmer's recent remarks, it doesn't follow that there is no issue here and we can all move along. Reeves did misinform the public about the considerations shaping her choices. Was it to funnel cash to "welfare recipients", like the Tories assert? Certainly not, and the figures demonstrate it.

A Reputation Takes Another Hit, Yet Truth Must Win Out

The Chancellor has taken another hit to her standing, however, should facts still have anything to do with politics, Badenoch ought to call off her lynch mob. Maybe the stepping down yesterday of the Office for Budget Responsibility (OBR) chief, Richard Hughes, due to the leak of its own documents will quench Westminster's appetite for scandal.

But the true narrative is much more unusual compared to the headlines suggest, and stretches broader and deeper beyond the careers of Starmer and the class of '24. At its heart, herein lies a story about what degree of influence you and I have over the running of the nation. And it concern you.

Firstly, to Brass Tacks

When 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 merely had the OBR never done such a thing before (an "exceptional move"), its numbers seemingly contradicted the chancellor's words. Even as rumors from Westminster were about how bleak the budget was going to be, the watchdog's predictions were getting better.

Consider the Treasury's so-called "iron-clad" rule, stating by 2030 day-to-day spending for hospitals, schools, and the rest must be wholly paid for by taxes: at the end of October, the OBR calculated this would barely be met, albeit only by a minuscule margin.

Several days later, Reeves held a press conference so unprecedented it forced breakfast TV to interrupt its usual fare. Weeks before the real budget, the nation was warned: taxes would rise, and the main reason being pessimistic numbers provided by the OBR, specifically its conclusion that the UK was less productive, putting more in but yielding less.

And lo! It came to pass. Notwithstanding what Telegraph editorials and Tory media appearances suggested recently, that is basically what happened at the budget, which was significant, harsh, and grim.

The Deceptive Alibi

Where Reeves misled us concerned her justification, because these OBR forecasts didn't force her hand. She might have made other choices; she might have given alternative explanations, including during the statement. Before last year's election, Starmer pledged precisely this kind of public influence. "The hope of democracy. The strength of the vote. The potential for national renewal."

One year later, yet it is a lack of agency that is evident in Reeves's breakfast speech. The first Labour chancellor in 15 years portrays herself to be a technocrat at the mercy of factors outside her influence: "In the context of the persistent challenges on our productivity … any chancellor of any political stripe would be in this position today, confronting the choices that I face."

She certainly make decisions, just not one Labour cares to publicize. From April 2029 British workers and businesses will be paying an additional £26bn annually in tax – but the majority of this will not go towards spent on better hospitals, new libraries, nor happier lives. Whatever nonsense comes from Nigel Farage, Badenoch and others, it is not being lavished upon "benefits street".

Where the Cash Actually Ends Up

Rather than going on services, over 50% of this extra cash will in fact give Reeves a buffer for her own budgetary constraints. Approximately 25% is allocated to covering the government's own policy reversals. Examining the OBR's calculations and giving maximum benefit of the doubt towards Reeves, a mere 17% of the tax take will fund genuinely additional spending, such as abolishing the two-child cap on child benefit. Its abolition "costs" the Treasury a mere £2.5bn, because it had long been an act of political theatre from George Osborne. This administration 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 how Reeves conforms to the stereotype of Labour chancellors, soaking hard workers to fund the workshy. Labour backbenchers have been applauding her budget for being a relief to their troubled consciences, protecting the disadvantaged. Each group are completely mistaken: The Chancellor's budget was largely aimed at asset managers, hedge funds and the others in the financial markets.

Downing Street can make a compelling argument in its defence. The margins from the OBR were insufficient to feel secure, especially considering bond investors charge the UK the highest interest rate of all G7 rich countries – higher than France, that recently lost a prime minister, and exceeding Japan that carries way more debt. Coupled with the policies to hold down fuel bills, prescription charges and train fares, Starmer together with Reeves can say their plan enables the central bank to reduce its key lending rate.

It's understandable that those folk with Labour badges may choose not to frame it this way next time they visit #Labourdoorstep. According to one independent adviser for Downing Street puts it, Reeves has "utilised" financial markets as an instrument of discipline over her own party and the voters. It's why the chancellor cannot resign, no matter what pledges she breaks. It's the reason Labour MPs must knuckle down and support measures that cut billions from social security, just as Starmer promised yesterday.

Missing Political Vision , an Unfulfilled Pledge

What is absent here is any sense of strategic governance, of harnessing the finance ministry and the Bank to forge a new accommodation with investors. Also absent is any intuitive knowledge of voters,