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The accusation represents a grave matter: that Rachel Reeves has lied to UK citizens, frightening them to accept billions in additional taxes that could be used for increased welfare payments. However hyperbolic, this is not usual Westminster bickering; this time, the consequences are higher. A week ago, critics aimed at Reeves alongside Keir Starmer were labeling their budget "a mess". Today, it's denounced as lies, and Kemi Badenoch demanding the chancellor's resignation.

Such a serious accusation requires straightforward responses, therefore here is my view. Did the chancellor lied? Based on the available information, apparently not. There were no whoppers. However, despite Starmer's recent comments, it doesn't follow that there is nothing to see and we can all move along. Reeves did misinform the public regarding the considerations informing her choices. Was it to channel cash to "benefits street", as the Tories claim? Certainly not, and the numbers prove it.

A Reputation Takes Another Blow, Yet Truth Must Win Out

Reeves has taken a further blow to her standing, but, should facts still matter in politics, Badenoch should stand down her lynch mob. Perhaps the resignation recently of OBR head, Richard Hughes, over the leak of its internal documents will quench Westminster's appetite for scandal.

Yet the real story is far stranger than media reports suggest, extending wider and further than the careers of Starmer and the 2024 intake. Fundamentally, this is a story concerning what degree of influence the public get over the governance of the nation. This should concern everyone.

First, to Brass Tacks

When the OBR released recently a portion of the projections it provided to 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 contradicted Reeves's statements. While rumors from Westminster suggested how bleak the budget was going to be, the watchdog's forecasts were improving.

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

A few days later, Reeves held a media briefing so extraordinary it forced breakfast TV to interrupt its regular schedule. Weeks prior to the actual budget, the country was put on alert: taxes were going up, and the main reason being gloomy numbers from the OBR, specifically its conclusion that the UK was less efficient, investing more but getting less out.

And lo! It came to pass. Notwithstanding the implications from Telegraph editorials combined with Tory broadcast rounds implied recently, that is basically what transpired at the budget, that proved to be big and painful and bleak.

The Deceptive Justification

The way in which Reeves misled us concerned her alibi, because those OBR forecasts did not force her hand. She could have made other choices; she could have provided alternative explanations, including on budget day itself. Before the recent election, Starmer pledged exactly such public influence. "The hope of democracy. The strength of the vote. The possibility for national renewal."

One year later, and it's powerlessness that is evident from Reeves's breakfast speech. The first Labour chancellor for a decade and a half portrays herself as a technocrat at the mercy of factors outside her influence: "In the context of the persistent challenges with our productivity … any chancellor of any political stripe would be standing here today, facing the choices that I face."

She did make decisions, just not the kind the Labour party wishes to broadcast. From April 2029 British workers as well as businesses are set to be contributing an additional £26bn annually in taxes – but most of that will not go towards funding improved healthcare, new libraries, or happier lives. Regardless of what bilge comes from Nigel Farage, Badenoch and their allies, it is not getting splashed on "welfare claimants".

Where the Cash Really Goes

Rather than being spent, over 50% of the extra cash will instead give Reeves cushion against her own budgetary constraints. About 25% goes on covering the administration's policy reversals. Reviewing the watchdog's figures and giving maximum benefit of the doubt towards Reeves, only 17% of the tax take will go on actual new spending, such as abolishing the two-child cap on child benefit. Its abolition "will cost" the Treasury a mere £2.5bn, as it had long been a bit of political theatre by George Osborne. A Labour government could and should abolished it in its first 100 days.

The Real Target: Financial Institutions

The Tories, Reform along with the entire right-wing media have been barking about how Reeves conforms to the caricature of Labour chancellors, taxing strivers to fund shirkers. Labour backbenchers have been applauding her budget for being balm to their troubled consciences, protecting the most vulnerable. Both sides could be 180-degrees wrong: Reeves's budget was largely aimed at investment funds, hedge funds and participants within the bond markets.

The government can make a compelling argument for itself. The forecasts from the OBR were deemed too small for comfort, particularly given that bond investors charge the UK the highest interest rate among G7 rich countries – higher than France, which lost its leader, and exceeding Japan which has far greater debt. Combined with our measures to cap fuel bills, prescription charges and train fares, Starmer and Reeves can say this budget allows the central bank to reduce its key lending rate.

You can see why those folk with red rosettes might not couch it this way next time they visit #Labourdoorstep. According to a consultant for Downing Street says, Reeves has effectively "utilised" the bond market to act as a tool of control over her own party and the electorate. This is the reason Reeves can't resign, no matter what promises she breaks. It's the reason Labour MPs must fall into line and support measures that cut billions from social security, as Starmer promised recently.

Missing Political Vision , an Unfulfilled Promise

What is absent from this is any sense of statecraft, of mobilising the finance ministry and the central bank to forge a fresh understanding with investors. Missing too is any innate understanding of voters,