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The accusation is a serious one: suggesting Rachel Reeves has lied to the British public, frightening them to accept billions in extra taxes which would be used for increased benefits. However exaggerated, this is not typical political sparring; this time, the consequences are more serious. A week ago, critics aimed at Reeves and Keir Starmer were calling their budget "a shambles". Now, it is denounced as lies, and Kemi Badenoch calling for the chancellor's resignation.

This grave accusation demands straightforward answers, therefore let me provide my assessment. Did the chancellor been dishonest? On the available evidence, no. She told no blatant falsehoods. But, notwithstanding Starmer's recent comments, it doesn't follow that there is no issue here and we can all move along. Reeves did mislead the public about the factors informing her choices. Was this all to channel cash to "welfare recipients", as the Tories assert? No, as the numbers prove this.

A Reputation Takes A Further Blow, Yet Truth Must Prevail

Reeves has taken a further hit to her reputation, however, should facts continue to 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 unauthorized release of its internal documents will quench SW1's thirst for blood.

Yet the real story is far stranger than the headlines indicate, extending wider and further than the political futures of Starmer and the class of '24. Fundamentally, herein lies a story about what degree of influence the public have over the running of the nation. This should should worry everyone.

First, on to Brass Tacks

After the OBR released last Friday a portion of the projections it shared with Reeves while she wrote the red book, the shock was immediate. Not merely had the OBR never done such a thing before (an "unusual step"), its figures seemingly went against the chancellor's words. Even as rumors from Westminster suggested how bleak the budget would have to be, the OBR's own forecasts were improving.

Take the government's so-called "iron-clad" fiscal rule, stating by 2030 day-to-day spending on hospitals, schools, and the rest would be wholly paid for by taxes: in late October, the watchdog reckoned this would barely be met, albeit only by a tiny margin.

A few days later, Reeves held a media briefing so extraordinary that it caused breakfast TV to break from its usual fare. Several weeks before the actual budget, the nation was put on alert: taxes would rise, and the main reason being gloomy numbers from the OBR, specifically its finding that the UK was less productive, putting more in but getting less out.

And lo! It came to pass. Despite what Telegraph editorials combined with Tory media appearances suggested recently, this is basically what happened at the budget, that proved to be significant, harsh, and grim.

The Deceptive Alibi

The way in which Reeves deceived us concerned her justification, 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. Before the recent election, Starmer promised exactly such public influence. "The hope of democracy. The strength of the vote. The possibility for national renewal."

One year later, yet it's powerlessness that is evident from Reeves's breakfast speech. Our first Labour chancellor in 15 years portrays herself as an apolitical figure at the mercy of forces 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 choices that I face."

She certainly make decisions, just not the kind Labour wishes to broadcast. From 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 go towards spent on improved healthcare, new libraries, or enhanced wellbeing. Regardless of what nonsense is spouted by Nigel Farage, Badenoch and others, it isn't being lavished upon "benefits street".

Where the Cash Actually Ends Up

Instead of going on services, over 50% of the additional revenue will in fact provide Reeves a buffer for her own budgetary constraints. Approximately 25% goes on covering the government's own U-turns. Examining the watchdog's figures and giving maximum benefit of the doubt to a Labour chancellor, only 17% of the tax take will fund genuinely additional spending, such as abolishing the two-child cap on child benefit. Removing it "will cost" the Treasury a mere £2.5bn, as it had long been a bit of theatrical cruelty from George Osborne. This administration should have abolished it in its first 100 days.

The Real Target: Financial Institutions

Conservatives, Reform and the entire right-wing media have spent days railing against the idea that Reeves conforms to the caricature of Labour chancellors, soaking strivers to fund the workshy. Labour backbenchers have been cheering her budget for being a relief for their social concerns, safeguarding the most vulnerable. Both sides are 180-degrees wrong: Reeves's budget was largely targeted towards investment funds, hedge funds and the others in the financial markets.

The government can make a compelling argument in its defence. The forecasts provided by the OBR were insufficient to feel secure, particularly given that lenders charge the UK the highest interest rate of all G7 developed nations – exceeding that of France, that recently lost a prime minister, higher than Japan that carries far greater debt. Coupled with the policies to cap fuel bills, prescription charges as well as train fares, Starmer together with Reeves can say this budget enables the central bank to reduce its key lending rate.

You can see that those folk with red rosettes might not couch it in such terms when they visit #Labourdoorstep. As one independent adviser for Downing Street puts it, Reeves has "utilised" the bond market as an instrument of discipline against her own party and the electorate. It's the reason the chancellor can't resign, no matter what promises she breaks. It is also the reason Labour MPs must knuckle down and vote to take billions off social security, as Starmer indicated yesterday.

A Lack of Statecraft and an Unfulfilled Promise

What is absent here is the notion of strategic governance, of mobilising the Treasury and the central bank to reach a fresh understanding with markets. Also absent is innate understanding of voters,