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This allegation represents a grave matter: suggesting Rachel Reeves has lied to the British public, frightening them into accepting billions in extra taxes that could be spent on increased benefits. However exaggerated, this isn't typical Westminster bickering; on this occasion, the consequences are more serious. Just last week, critics of Reeves alongside Keir Starmer were calling their budget "disorderly". Today, it is branded as falsehoods, and Kemi Badenoch demanding the chancellor's resignation.

This grave accusation requires clear responses, therefore here is my assessment. Has the chancellor lied? Based on current evidence, no. There were no major untruths. However, despite Starmer's recent remarks, it doesn't follow that there's nothing to see and we should move on. The Chancellor did misinform the public about the factors shaping her choices. Was this all to funnel cash to "benefits street", like the Tories assert? No, and the numbers demonstrate this.

A Reputation Takes Another Hit, But Facts Must Win Out

Reeves has taken a further hit to her reputation, but, if facts still matter in politics, Badenoch ought to stand down her lynch mob. Perhaps the stepping down recently of the Office for Budget Responsibility (OBR) chief, Richard Hughes, over the leak of its internal documents will satisfy Westminster's thirst for blood.

But the real story is much more unusual than the headlines indicate, extending wider and further than the political futures of Starmer and the 2024 intake. Fundamentally, this is a story concerning what degree of influence the public get over the governance of our own country. This should should worry you.

First, on to Brass Tacks

When the OBR published recently a portion of the forecasts it provided to Reeves while she wrote the red book, the surprise was instant. Not merely had the OBR never acted this way before (an "unusual step"), its numbers apparently contradicted Reeves's statements. Even as leaks from Westminster suggested how bleak the budget would have to be, the OBR's own forecasts were improving.

Consider the government's so-called "unbreakable" fiscal rule, stating by 2030 day-to-day spending for hospitals, schools, and other services would be wholly paid for 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 that it caused morning television to interrupt its usual fare. Several weeks prior to the actual budget, the nation was put on alert: taxes were going up, and the primary cause being gloomy numbers from the OBR, in particular its finding that the UK had become less efficient, investing more but getting less out.

And lo! It came to pass. Despite the implications from Telegraph editorials and Tory media appearances suggested over the weekend, that is basically what happened during the budget, which was significant, harsh, and grim.

The Deceptive Alibi

The way in which Reeves misled us was her justification, because those OBR forecasts didn't force her hand. She might have chosen other choices; she could have provided alternative explanations, even during the statement. Prior to the recent election, Starmer promised precisely this kind of public influence. "The hope of democracy. The strength of the vote. The possibility for national renewal."

A year on, and it's a lack of agency that is evident in Reeves's breakfast speech. Our first Labour chancellor for a decade and a half portrays herself as a technocrat at the mercy of factors beyond her control: "Given the circumstances of the persistent challenges with our productivity … any chancellor of any political stripe would be standing here today, confronting the decisions that I face."

She certainly make decisions, only not one Labour cares to publicize. From April 2029 UK workers and businesses will be contributing another £26bn a year in taxes – but the majority of this will not be spent on improved healthcare, new libraries, or happier lives. Regardless of what bilge is spouted by Nigel Farage, Badenoch and their allies, it is not being lavished upon "welfare claimants".

Where the Money Actually Ends Up

Instead of being spent, over 50% of this extra cash will instead give Reeves a buffer against her self-imposed budgetary constraints. Approximately 25% is allocated to covering the administration's policy reversals. Reviewing the OBR's calculations and giving maximum benefit of the doubt towards Reeves, a mere 17% of the tax take will go on genuinely additional spending, for example scrapping the two-child cap on child benefit. Its abolition "costs" the Treasury only £2.5bn, because it had long been a bit of theatrical cruelty from George Osborne. A Labour government should have have binned it immediately upon taking office.

The True Audience: The Bond Markets

Conservatives, Reform and all of right-wing media have spent days railing against how Reeves fits the stereotype of Labour chancellors, soaking strivers to spend on the workshy. Labour backbenchers have been applauding her budget as balm for their social concerns, protecting the most vulnerable. Each group are 180-degrees wrong: The Chancellor's budget was primarily aimed at asset managers, hedge funds and participants within the bond markets.

The government could present a compelling argument in its defence. The forecasts from the OBR were insufficient to feel secure, particularly given that bond investors charge the UK the highest interest rate of all G7 developed nations – exceeding that of France, which lost its leader, and exceeding Japan which has far greater debt. Coupled with the policies to cap fuel bills, prescription charges and train fares, Starmer and Reeves can say their plan allows the Bank of England to cut interest rates.

You can see why those folk with Labour badges may choose not to frame it in such terms next time they visit the doorstep. According to a consultant to Downing Street puts it, Reeves has "weaponised" the bond market as a tool of control over her own party and the electorate. It's the reason the chancellor cannot resign, regardless of which promises are broken. It's the reason Labour MPs must knuckle down and support measures to take billions off social security, as Starmer indicated yesterday.

A Lack of Statecraft and an Unfulfilled Pledge

What is absent from this is any sense of statecraft, of harnessing the finance ministry and the Bank to reach a new accommodation with investors. Missing too is innate understanding of voters,