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This accusation carries significant weight: that Rachel Reeves has lied to the British public, scaring them to accept massive extra taxes that could be spent on increased welfare payments. While hyperbolic, this is not usual political sparring; on this occasion, the consequences are higher. Just last week, detractors aimed at Reeves and Keir Starmer had been calling their budget "uncoordinated". Now, it is branded as falsehoods, with Kemi Badenoch demanding the chancellor's resignation.

This grave charge demands straightforward responses, so let me provide my assessment. Has the chancellor been dishonest? Based on current evidence, no. She told no whoppers. However, despite Starmer's recent remarks, that doesn't mean there's no issue here and we should move on. Reeves did misinform the public regarding the factors shaping her choices. Was this all to channel cash to "benefits street", like the Tories assert? Certainly not, and the numbers demonstrate it.

A Reputation Sustains Another Hit, Yet Truth Should Win Out

The Chancellor has sustained a further blow to her reputation, but, if facts continue to matter in politics, Badenoch should call off her lynch mob. Perhaps the stepping down yesterday of the Office for Budget Responsibility (OBR) chief, Richard Hughes, due to the unauthorized release of its internal documents will quench Westminster's thirst for blood.

But the real story is much more unusual than the headlines suggest, and stretches broader and deeper than the careers of Starmer and his 2024 intake. At its heart, this is an account about what degree of influence the public get in the governance of the nation. And it should worry you.

First, to the Core Details

After the OBR released last Friday some of the forecasts it provided to Reeves as she wrote 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 went against Reeves's statements. While leaks from Westminster suggested how bleak the budget was going to be, the watchdog's predictions were improving.

Take the government's most "iron-clad" fiscal rule, that by 2030 daily spending on hospitals, schools, and the rest would be wholly funded by taxes: at the end of October, the OBR reckoned it would barely be met, albeit by a minuscule margin.

Several days later, Reeves held a press conference so extraordinary it forced morning television to interrupt its regular schedule. Several weeks before the actual budget, the country was put on alert: taxes were going up, with the main reason being gloomy numbers from the OBR, in particular its conclusion that the UK was less productive, investing more but getting less out.

And so! It came to pass. Despite the implications from Telegraph editorials and Tory broadcast rounds implied recently, this is basically what transpired at the budget, that proved to be big and painful and bleak.

The Misleading Alibi

Where Reeves deceived us concerned her justification, since these OBR forecasts did not compel her actions. She might have chosen different options; she could have given alternative explanations, even on budget day itself. Before last year's election, Starmer promised exactly such people power. "The hope of democracy. The power of the vote. The possibility for national renewal."

A year on, yet it is a lack of agency that is evident from Reeves's pre-budget speech. Our first Labour chancellor in 15 years portrays herself as a technocrat buffeted by factors outside her influence: "Given the circumstances of the persistent challenges on our productivity … any chancellor of any party would be standing here today, facing the decisions that I face."

She certainly make a choice, only not one the Labour party wishes to publicize. Starting April 2029 British workers as well as businesses will be contributing another £26bn annually in taxes – but the majority of this will not go towards funding better hospitals, public services, nor happier lives. Regardless of what bilge comes from Nigel Farage, Badenoch and others, it is not being lavished upon "welfare claimants".

Where the Cash Really Goes

Rather than going on services, more than 50% of the extra cash will instead provide Reeves cushion against her self-imposed fiscal rules. Approximately 25% goes on covering the administration's U-turns. Reviewing the OBR's calculations and being as generous as possible to Reeves, a mere 17% of the tax take will go on genuinely additional spending, such as scrapping the limit on child benefit. Removing it "will cost" the Treasury only £2.5bn, because it had long been an act of political theatre from George Osborne. This administration could and should abolished it immediately upon taking office.

The True Audience: The Bond Markets

The Tories, Reform along with the entire right-wing media have spent days railing against how Reeves fits the caricature of Labour chancellors, taxing hard workers to spend on shirkers. Labour backbenchers have been applauding her budget as balm for their troubled consciences, protecting the most vulnerable. Both sides are completely mistaken: Reeves's budget was primarily targeted towards investment funds, hedge funds and participants within the bond markets.

The government can make a strong case in its defence. The margins provided by the OBR were deemed insufficient to feel secure, particularly considering bond investors demand from the UK the highest interest rate of all G7 rich countries – higher than France, that recently lost a prime minister, and exceeding Japan which has far greater debt. Combined with the policies to hold down fuel bills, prescription charges as well as train fares, Starmer together with Reeves argue this budget allows the central bank to reduce interest rates.

It's understandable why those folk with Labour badges might not frame it this way when they're on the doorstep. According to a consultant to Downing Street says, Reeves has effectively "weaponised" the bond market as an instrument of discipline against Labour MPs and the electorate. It's the reason the chancellor can't resign, no matter what promises are broken. It's why Labour MPs will have to knuckle down and support measures to take billions off social security, as Starmer promised recently.

Missing Statecraft , an Unfulfilled Pledge

What's missing here is the notion of statecraft, of mobilising the Treasury and the central bank to reach a new accommodation with investors. Also absent is innate understanding of voters,