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The accusation is a serious one: that Rachel Reeves may have misled UK citizens, frightening them to accept billions in extra taxes that could be used for higher welfare payments. However exaggerated, this is not usual political sparring; this time, the consequences are more serious. Just last week, critics of Reeves and Keir Starmer were calling their budget "a shambles". Now, it's branded as lies, with Kemi Badenoch calling for the chancellor to quit.

Such a grave charge requires straightforward responses, so here is my assessment. Has the chancellor been dishonest? On the available evidence, no. She told no major untruths. But, notwithstanding Starmer's yesterday's comments, that doesn't mean there's no issue here and we can all move along. Reeves did misinform the public regarding the considerations informing her decisions. Was this all to funnel cash to "benefits street", like the Tories claim? Certainly not, and the numbers demonstrate it.

A Reputation Sustains Another Blow, But Facts Should Prevail

Reeves has sustained another hit to her standing, but, if facts still have anything to do with politics, Badenoch should stand down her attack dogs. Perhaps the stepping down yesterday of the Office for Budget Responsibility (OBR) chief, Richard Hughes, due to the unauthorized release of its internal documents will satisfy Westminster's thirst for blood.

But the real story is much more unusual than media reports suggest, and stretches wider and further beyond the political futures of Starmer and the class of '24. Fundamentally, herein lies an account concerning what degree of influence the public get over the running of our own country. And it should worry you.

First, to Brass Tacks

After the OBR released last Friday some of the forecasts it shared with Reeves as she prepared the red book, the shock was instant. Not only has the OBR never acted this way before (described as an "unusual step"), its numbers apparently went against the chancellor's words. While rumors from Westminster were about how bleak the budget would have to be, the OBR's own predictions were getting better.

Consider the Treasury's most "unbreakable" fiscal rule, stating by 2030 day-to-day spending for hospitals, schools, and other services would be wholly funded by taxes: in late October, the watchdog reckoned it would just about be met, albeit by a minuscule margin.

A few days later, Reeves held a media briefing so extraordinary that it caused breakfast TV to interrupt its usual fare. Weeks prior to the actual budget, the country was warned: taxes would rise, with the main reason cited as pessimistic numbers from the OBR, specifically its finding that the UK had become less productive, investing more but getting less out.

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

The Deceptive Alibi

Where Reeves deceived us was her alibi, since those OBR forecasts did not force her hand. She might have made other choices; she could have provided other reasons, even on budget day itself. Prior to last year's election, Starmer pledged precisely this kind of public influence. "The hope of democracy. The strength of the vote. The possibility for national renewal."

A year on, yet it is powerlessness that jumps out in Reeves's breakfast speech. Our first Labour chancellor for a decade and a half portrays herself as an apolitical figure at the mercy of factors outside her influence: "Given the circumstances of the long-term challenges on our productivity … any finance minister of any party would be in this position today, confronting the decisions that I face."

She did make decisions, just not one Labour cares 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 go towards spent on improved healthcare, public services, nor happier lives. Regardless of what nonsense is spouted by Nigel Farage, Badenoch and their allies, it isn't getting splashed on "welfare claimants".

Where the Money Actually Ends Up

Instead of being spent, over 50% of this extra cash will in fact give Reeves cushion against her own budgetary constraints. About 25% goes on covering the administration's policy reversals. Reviewing the OBR's calculations and giving maximum benefit of the doubt towards a Labour chancellor, a mere 17% of the tax take will fund actual new spending, such as abolishing the limit on child benefit. Its abolition "will cost" the Treasury a mere £2.5bn, as it was always a bit of theatrical cruelty by George Osborne. This administration should have have binned it immediately upon taking office.

The True Audience: The Bond Markets

Conservatives, Reform along with all of right-wing media have been railing against the idea that Reeves fits the caricature of left-wing finance ministers, soaking hard workers to spend on the workshy. Party MPs are cheering her budget for being balm for their social concerns, protecting the disadvantaged. Each group are completely mistaken: Reeves's budget was largely targeted towards asset managers, speculative capital and participants within the financial markets.

The government could present a compelling argument in its defence. The forecasts provided by the OBR were deemed insufficient for comfort, particularly given that lenders demand from the UK the highest interest rate among G7 developed nations – exceeding that of France, that recently lost its leader, and exceeding Japan that carries way more debt. Coupled with the policies to cap fuel bills, prescription charges and train fares, Starmer and Reeves can say this budget enables the Bank of England to cut its key lending rate.

You can see why those wearing red rosettes may choose not to couch it in such terms next time they visit the doorstep. According to a consultant to Downing Street says, Reeves has "weaponised" financial markets to act as a tool of control against her own party and the electorate. This is why Reeves cannot resign, regardless of which pledges she breaks. It's why Labour MPs must knuckle down and vote to take billions off social security, as Starmer indicated recently.

A Lack of Political Vision and a Broken Pledge

What is absent here is the notion of statecraft, of mobilising the Treasury and the central bank to forge a new accommodation with markets. Also absent is any innate understanding of voters,