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The allegation carries significant weight: suggesting Rachel Reeves has lied to Britons, frightening them into accepting massive additional taxes that would be spent on increased welfare payments. While hyperbolic, this isn't typical Westminster sparring; this time, the consequences could be damaging. Just last week, detractors aimed at Reeves alongside Keir Starmer were labeling their budget "a mess". Now, it is denounced as lies, 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 current information, apparently not. There were no major untruths. But, notwithstanding Starmer's recent remarks, that doesn't mean there's nothing to see and we can all move along. Reeves did mislead the public regarding the considerations shaping her decisions. Was it to funnel cash towards "welfare recipients", like the Tories assert? Certainly not, as the figures demonstrate it.

A Standing Sustains A Further Blow, Yet Truth Should Prevail

Reeves has taken a further blow to her standing, but, if facts continue to matter in politics, Badenoch ought to stand down her attack dogs. Perhaps the stepping down yesterday of the Office for Budget Responsibility (OBR) chief, Richard Hughes, due to the leak of its internal documents will satisfy SW1's appetite for scandal.

But the true narrative is much more unusual compared to media reports indicate, extending broader and deeper than the political futures of Starmer and the 2024 intake. Fundamentally, this is a story about what degree of influence the public get over the governance of our own country. And it concern everyone.

First, on to Brass Tacks

When the OBR released recently a portion of the projections it shared with Reeves as she prepared the red book, the surprise was instant. Not merely had the OBR not done such a thing before (described as an "exceptional move"), its numbers apparently contradicted Reeves's statements. Even as rumors from Westminster were about how bleak the budget would have to be, the watchdog's predictions were getting better.

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

Several days later, Reeves held a media briefing so unprecedented that it caused morning television to break from its usual fare. Several weeks prior to the real budget, the nation was warned: taxes were going up, and the main reason being gloomy numbers provided by the OBR, specifically its conclusion that the UK had become less productive, investing more but yielding less.

And lo! It happened. Notwithstanding the implications from Telegraph editorials combined with Tory media appearances suggested over the weekend, this is essentially what happened during the budget, which was big and painful and bleak.

The Misleading Justification

Where Reeves misled us was her alibi, because these OBR forecasts did not force her hand. She might have made other choices; she could have given other reasons, including on budget day itself. Prior to the recent election, Starmer pledged precisely this kind of public influence. "The hope of democracy. The strength of the vote. The potential for national renewal."

A year on, and it is powerlessness that jumps out in Reeves's breakfast speech. Our first Labour chancellor for a decade and a half portrays herself as an apolitical figure at the mercy of factors beyond her control: "In the context of the persistent challenges with our productivity … any finance minister of any political stripe would be in this position today, facing the decisions that I face."

She certainly make decisions, just not the kind Labour cares to broadcast. From April 2029 British workers as well as businesses will be contributing an additional £26bn a year in taxes – but most of that will not go towards funding better hospitals, new libraries, or enhanced wellbeing. Regardless of what nonsense comes from Nigel Farage, Badenoch and others, it is not being lavished upon "welfare claimants".

Where the Money Actually Ends Up

Rather than being spent, more than 50% of this additional revenue will instead give Reeves a buffer for her self-imposed fiscal rules. Approximately 25% is allocated to paying for the government's own U-turns. Reviewing the watchdog's figures and being as generous as possible towards Reeves, a mere 17% of the tax take will fund actual new spending, such as abolishing the limit on child benefit. Removing it "will cost" the Treasury only £2.5bn, as it had long been an act of political theatre by George Osborne. This administration could and should have binned it immediately upon taking office.

The Real Target: Financial Institutions

Conservatives, Reform along with the entire right-wing media have been railing against how Reeves conforms to the caricature of left-wing finance ministers, taxing strivers to fund shirkers. Labour backbenchers have been cheering her budget as a relief for their troubled consciences, safeguarding the disadvantaged. Both sides are 180-degrees wrong: Reeves's budget was largely aimed at investment funds, speculative capital and the others in the financial markets.

The government can make a compelling argument for itself. The margins provided by the OBR were too small to feel secure, especially considering lenders charge the UK the greatest borrowing cost of all G7 developed nations – exceeding that of France, which lost a prime minister, higher than Japan which has way more debt. Coupled with the policies to cap fuel bills, prescription charges and train fares, Starmer together with Reeves can say this budget allows the central bank to cut interest rates.

It's understandable why those folk with Labour badges might not frame it this way next time they visit #Labourdoorstep. According to a consultant to Downing Street puts it, Reeves has "utilised" financial markets as an instrument of control over Labour MPs and the voters. This is the reason Reeves can't resign, no matter what promises she breaks. It is also why Labour MPs must knuckle down and support measures to take billions off social security, just as Starmer indicated yesterday.

A Lack of Political Vision and a Broken Promise

What's missing here is any sense of strategic governance, of harnessing the Treasury and the central bank to reach a fresh understanding with investors. Also absent is any innate understanding of voters,