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The allegation is a serious one: that Rachel Reeves has lied to Britons, scaring them to accept billions in extra taxes which could be funneled into increased welfare payments. While hyperbolic, this is not typical Westminster sparring; on this occasion, the stakes are more serious. Just last week, detractors aimed at Reeves alongside Keir Starmer were calling their budget "disorderly". Now, it is denounced as lies, with Kemi Badenoch demanding Reeves to step down.

Such a serious charge demands clear answers, so let me provide my assessment. Did the chancellor been dishonest? Based on current information, no. There were no blatant falsehoods. But, despite Starmer's recent remarks, that doesn't mean there is nothing to see and we should move on. The Chancellor did mislead the public regarding the considerations informing her choices. Was it to funnel cash towards "welfare recipients", as the Tories claim? Certainly not, and the numbers prove this.

A Standing Sustains Another Hit, Yet Truth Should Win Out

The Chancellor has sustained another hit to her reputation, but, should facts continue to matter in politics, Badenoch ought to call off her lynch mob. Perhaps the stepping down recently of the Office for Budget Responsibility (OBR) chief, Richard Hughes, over the unauthorized release of its internal documents will quench SW1's appetite for scandal.

Yet the true narrative is much more unusual than media reports suggest, and stretches broader and deeper than the political futures of Starmer and the class of '24. Fundamentally, this is a story concerning how much say you and I have in the governance of the nation. This should concern you.

First, to Brass Tacks

When the OBR published last Friday some of the projections it provided to Reeves while she prepared the budget, the shock was immediate. Not merely had the OBR not acted this way before (described as an "exceptional move"), its numbers apparently contradicted the chancellor's words. Even as rumors from Westminster were about the grim nature of the budget would have to be, the watchdog's forecasts were getting better.

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

Several days later, Reeves held a press conference so unprecedented that it caused morning television to interrupt its usual fare. Several weeks prior to the actual budget, the nation was warned: taxes would rise, with the primary cause being gloomy numbers from the OBR, specifically its conclusion suggesting the UK had become less efficient, putting more in but getting less out.

And lo! It happened. Despite what Telegraph editorials combined with Tory broadcast rounds implied over the weekend, this is essentially what transpired during the budget, that proved to be significant, harsh, and grim.

The Deceptive Alibi

Where Reeves deceived us concerned her alibi, because those OBR forecasts did not force her hand. She could have chosen other choices; she might have given other reasons, even on budget day itself. Before the recent election, Starmer pledged exactly such people power. "The promise of democracy. The power of the vote. The possibility for national renewal."

A year on, and it is powerlessness that is evident from Reeves's breakfast speech. Our first Labour chancellor in 15 years casts herself to be a technocrat at the mercy of forces beyond her control: "In the context of the long-term challenges with our productivity … any finance minister of any political stripe would be in this position today, confronting the decisions that I face."

She certainly make decisions, only not one Labour wishes to broadcast. Starting April 2029 British workers as well as businesses will be paying an additional £26bn annually in tax – but the majority of this will not be spent on better hospitals, public services, or happier lives. Whatever nonsense comes from Nigel Farage, Badenoch and their allies, it isn't being lavished upon "welfare claimants".

Where the Money Really Goes

Instead of going on services, more than 50% of this extra cash will instead give Reeves a buffer for her self-imposed fiscal rules. Approximately 25% is allocated to covering the government's own policy reversals. Examining the OBR's calculations and being as generous as possible to a Labour chancellor, a mere 17% of the taxes will fund actual new spending, for example scrapping the limit on child benefit. Removing it "costs" the Treasury a mere £2.5bn, as it had long been an act of political theatre by George Osborne. A Labour government could and should have binned it in its first 100 days.

The Real Target: Financial Institutions

Conservatives, Reform along with all of Blue Pravda have been railing against how Reeves conforms to the caricature of Labour chancellors, taxing hard workers to fund the workshy. Labour backbenchers have been cheering her budget as balm to their troubled consciences, safeguarding the disadvantaged. Both sides are completely mistaken: The Chancellor's budget was largely targeted towards investment funds, hedge funds and the others in the bond markets.

Downing Street could present a strong case in its defence. The forecasts from the OBR were deemed insufficient for comfort, particularly given that bond investors charge the UK the greatest borrowing cost of all G7 rich countries – exceeding that of France, that recently lost a prime minister, and exceeding Japan which has way more debt. Combined with the policies to hold down fuel bills, prescription charges and train fares, Starmer together with Reeves argue their plan allows the central bank to reduce its key lending rate.

You can see that those folk with Labour badges might not couch it in such terms next time they visit the doorstep. According to a consultant to Downing Street puts it, Reeves has "utilised" financial markets as an instrument of control over her own party and the electorate. This is why Reeves cannot resign, regardless of which promises are broken. It is also the reason Labour MPs will have to knuckle down and vote to take billions off social security, as Starmer indicated recently.

A Lack of Political Vision , a Broken Pledge

What's missing from this is the notion of statecraft, of mobilising the Treasury and the central bank to forge a fresh understanding with markets. Also absent is intuitive knowledge of voters,