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The accusation represents a grave matter: that Rachel Reeves may have misled Britons, frightening them into accepting billions in extra taxes which could be funneled into higher welfare payments. While exaggerated, this is not typical political bickering; on this occasion, the consequences could be damaging. Just last week, detractors aimed at Reeves and Keir Starmer were labeling their budget "disorderly". Today, it is branded as falsehoods, with Kemi Badenoch demanding Reeves to step down.

Such a serious charge requires clear answers, so here is my assessment. Has the chancellor been dishonest? On the available evidence, no. There were no whoppers. However, despite Starmer's yesterday's remarks, that doesn't mean there is no issue here and we should move on. Reeves did misinform the public about the considerations shaping her decisions. Was it to funnel cash towards "benefits street", like the Tories assert? No, as the numbers demonstrate this.

A Reputation Sustains A Further Blow, Yet Truth Should Prevail

Reeves has taken a further hit to her reputation, but, if facts continue to matter in politics, Badenoch should stand down her attack dogs. Perhaps the stepping down recently of OBR head, Richard Hughes, due to the unauthorized release of its own documents will quench Westminster's appetite for scandal.

But the real story is far stranger than the headlines suggest, extending wider and further than the careers of Starmer and the 2024 intake. At its heart, this is an account concerning what degree of influence the public have in the running of the nation. This should should worry you.

Firstly, on to Brass Tacks

When the OBR released last Friday some of the projections it shared with Reeves while she wrote the red book, the surprise was immediate. Not only has the OBR not done such a thing before (described as an "exceptional move"), its figures seemingly went against Reeves's statements. Even as leaks from Westminster suggested how bleak the budget was going to be, the OBR's own predictions were improving.

Consider the Treasury's so-called "unbreakable" fiscal rule, stating by 2030 daily spending on hospitals, schools, and the rest must be wholly funded by taxes: at the end of October, the OBR calculated it would just about be met, albeit only by a tiny margin.

A few days later, Reeves held a press conference so extraordinary it forced breakfast TV to interrupt its usual fare. Weeks before the real budget, the country was warned: taxes were going up, and the main reason 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 happened. Notwithstanding what Telegraph editorials combined with Tory media appearances suggested recently, that is basically what transpired during the budget, which was significant, harsh, and grim.

The Deceptive Justification

Where Reeves deceived us concerned her alibi, because these OBR forecasts didn't force her hand. She might have chosen other choices; she might have given alternative explanations, even on budget day itself. Prior to last year's election, Starmer promised precisely this kind of people power. "The promise of democracy. The strength of the vote. The possibility for national renewal."

A year on, and it is a lack of agency that is evident in Reeves's breakfast speech. The first Labour chancellor in 15 years casts herself to be an apolitical figure buffeted by forces beyond her control: "In the context of the long-term challenges on our productivity … any finance minister of any political stripe would be standing here today, confronting the decisions that I face."

She did make a choice, only not the kind Labour wishes to publicize. Starting April 2029 British workers as well as businesses are set to be contributing an additional £26bn annually in tax – but most of that will not be funding better hospitals, new libraries, or happier lives. Regardless of what nonsense comes from Nigel Farage, Badenoch and others, it is not getting splashed on "benefits street".

Where the Cash Really Goes

Rather than being spent, more than 50% of the extra cash will in fact provide Reeves a buffer against her self-imposed fiscal rules. Approximately 25% goes on covering the government's own policy reversals. Reviewing the OBR's calculations and giving maximum benefit of the doubt to Reeves, only 17% of the taxes will go on actual new spending, for example scrapping the two-child cap on child benefit. Removing it "will cost" the Treasury a mere £2.5bn, because it was always an act of political theatre 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 all of Blue Pravda have been railing against how Reeves conforms to the stereotype of left-wing finance ministers, soaking hard workers to spend on the workshy. Labour backbenchers have been applauding her budget for being balm for their social concerns, protecting the disadvantaged. Both sides could be 180-degrees wrong: Reeves's budget was primarily targeted towards asset managers, hedge funds and participants within the bond markets.

Downing Street can make a compelling argument in its defence. The forecasts provided by the OBR were deemed too small to feel secure, especially considering lenders charge the UK the greatest borrowing cost of all G7 rich countries – higher than France, that recently lost its leader, higher than Japan that carries far greater debt. Coupled with our policies to hold down fuel bills, prescription charges and train fares, Starmer together with Reeves argue their plan enables the Bank of England to reduce interest rates.

It's understandable that those wearing red rosettes might not couch it this way next time they visit #Labourdoorstep. As one independent adviser for Downing Street puts it, Reeves has effectively "weaponised" the bond market to act as a tool of discipline over her own party and the electorate. This is why Reeves can't resign, no matter what pledges she breaks. It's why Labour MPs will have to fall into line and vote to take billions off social security, just as Starmer indicated recently.

Missing Statecraft , an Unfulfilled Pledge

What's missing from this is any sense of statecraft, of harnessing the Treasury and the Bank to reach a fresh understanding with markets. Missing too is innate understanding of voters,