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The accusation carries significant weight: that Rachel Reeves may have lied to the British public, spooking them to accept billions in extra taxes that would be spent on increased benefits. While exaggerated, this isn't typical Westminster sparring; on this occasion, the stakes are higher. Just last week, detractors aimed at Reeves alongside Keir Starmer had been calling their budget "chaotic". Now, it is denounced as lies, with Kemi Badenoch calling for Reeves to step down.

Such a grave charge requires straightforward answers, so let me provide my view. Has the chancellor lied? On current evidence, no. There were no whoppers. However, notwithstanding Starmer's recent comments, that doesn't mean there is nothing to see and we should move on. The Chancellor did mislead the public regarding the factors informing her choices. Was this all to channel cash to "benefits street", like the Tories claim? Certainly not, as the figures prove this.

A Reputation Takes A Further Hit, But Facts Must Win Out

The Chancellor has sustained a further blow to her standing, however, should facts continue to have anything to do with politics, Badenoch should stand down her lynch mob. Perhaps the stepping down yesterday of OBR head, Richard Hughes, over the unauthorized release of its own documents will quench SW1's thirst for blood.

Yet the true narrative is much more unusual than the headlines suggest, and stretches wider and further beyond the political futures of Starmer and his 2024 intake. At its heart, this is a story concerning how much say the public get over the governance of the nation. And it should worry you.

First, to the Core Details

After the OBR published recently some of the forecasts it provided to Reeves while she prepared the budget, the surprise was instant. Not merely has the OBR never acted this way before (described as an "rare action"), its numbers apparently went against Reeves's statements. Even as leaks from Westminster suggested the grim nature of the budget was going to be, the OBR's own predictions were getting better.

Consider the Treasury's most "iron-clad" rule, that by 2030 daily spending on hospitals, schools, and other services would be completely funded by taxes: at the end of October, the watchdog reckoned this would barely be met, albeit by a minuscule margin.

Several days later, Reeves held a media briefing so unprecedented it forced breakfast TV to break from its regular schedule. Weeks prior to the real budget, the country was put on alert: taxes were going up, with the main reason cited as gloomy numbers from the OBR, in particular its finding that the UK had become less productive, putting more in but getting less out.

And so! It happened. Notwithstanding what Telegraph editorials and Tory media appearances suggested over the weekend, that is basically what transpired during the budget, that proved to be significant, harsh, and grim.

The Deceptive Alibi

Where Reeves misled us was her alibi, since those OBR forecasts did not force her hand. She could have made other choices; she could have provided other reasons, even during the statement. Prior to last year's election, Starmer pledged precisely this kind of people power. "The promise of democracy. The power of the vote. The potential for national renewal."

One year later, yet it's powerlessness that jumps out in Reeves's pre-budget speech. The first Labour chancellor in 15 years casts herself to be a technocrat at the mercy of factors outside her influence: "Given the circumstances of the persistent challenges with our productivity … any chancellor of any political stripe would be in this position today, facing the decisions that I face."

She certainly make a choice, just not one the Labour party wishes to broadcast. From April 2029 UK workers as well as businesses will be paying an additional £26bn a year in taxes – but the majority of this will not be spent on improved healthcare, public services, nor happier lives. Regardless of what bilge comes from Nigel Farage, Badenoch and others, it is not getting splashed on "welfare claimants".

Where the Cash Actually Ends Up

Rather than going on services, over 50% of the extra cash will instead provide Reeves cushion against her self-imposed fiscal rules. About 25% goes on paying for the government's own policy reversals. Reviewing the watchdog's figures and giving maximum benefit of the doubt to a Labour chancellor, only 17% of the taxes will go on genuinely additional spending, for example abolishing the limit on child benefit. Its abolition "will cost" the Treasury only £2.5bn, as it had long been an act of theatrical cruelty from George Osborne. This administration should have have binned it in its first 100 days.

The True Audience: The Bond Markets

The Tories, Reform along with all of right-wing media have been railing against the idea that Reeves fits the stereotype of Labour chancellors, taxing strivers to fund the workshy. Labour backbenchers have been applauding her budget as balm to their social concerns, protecting the disadvantaged. Each group could be 180-degrees wrong: The Chancellor's budget was primarily aimed at investment funds, speculative capital and participants within the financial markets.

Downing Street can make a compelling argument for itself. The forecasts from the OBR were deemed insufficient to feel secure, especially considering lenders charge the UK the greatest borrowing cost of all G7 rich countries – exceeding that of France, which lost a prime minister, higher than Japan which has far greater debt. Coupled with the policies to hold down fuel bills, prescription charges and train fares, Starmer and Reeves argue this budget allows the central bank to reduce its key lending rate.

You can see that those wearing red rosettes may choose not to frame it in such terms next time they're on the doorstep. As one independent adviser for Downing Street says, Reeves has "weaponised" financial markets to act as an instrument of discipline over Labour MPs and the electorate. This is the reason the chancellor cannot resign, no matter what pledges she breaks. It is also the reason Labour MPs will have to fall into line and vote that cut billions from social security, as Starmer indicated recently.

A Lack of Statecraft , a Broken Pledge

What's missing from this is the notion of statecraft, of mobilising the finance ministry and the central bank to reach a fresh understanding with investors. Also absent is any intuitive knowledge of voters,