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This allegation carries significant weight: that Rachel Reeves may have deceived UK citizens, spooking them into accepting massive additional taxes which would be used for increased benefits. However exaggerated, this is not typical Westminster bickering; this time, the stakes could be damaging. A week ago, critics of Reeves and Keir Starmer had been calling their budget "chaotic". Today, it's branded as lies, and Kemi Badenoch calling for the chancellor's resignation.

This grave accusation demands clear responses, therefore here is my view. Has the chancellor lied? On current evidence, apparently not. She told no major untruths. However, despite Starmer's yesterday's comments, it doesn't follow that there's nothing to see and we should move on. Reeves did mislead the public regarding the considerations shaping her choices. Was this all to funnel cash towards "welfare recipients", as the Tories claim? No, and the figures demonstrate this.

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

The Chancellor has sustained a further blow to her reputation, however, if facts still matter in politics, Badenoch should stand down her attack dogs. Maybe the stepping down yesterday of the Office for Budget Responsibility (OBR) chief, Richard Hughes, over the leak of its internal documents will quench Westminster's appetite for scandal.

But the true narrative is far stranger compared to the headlines indicate, and stretches broader and deeper than the political futures of Starmer and the class of '24. At its heart, herein lies a story concerning what degree of influence the public get in the running of the nation. This should concern you.

First, to Brass Tacks

After the OBR released recently some of the forecasts it shared with Reeves as she prepared the budget, the shock was instant. Not only had the OBR not acted this way before (an "unusual step"), its figures seemingly contradicted Reeves's statements. While leaks from Westminster were about the grim nature of the budget would have to be, the watchdog's predictions were getting better.

Take the Treasury's most "iron-clad" fiscal rule, stating by 2030 daily spending on hospitals, schools, and other services must be completely funded by taxes: in late October, the watchdog calculated this would just about be met, albeit only by a tiny margin.

A few days later, Reeves gave a press conference so unprecedented it forced morning television to break from its regular schedule. Weeks before the real budget, the country was put on alert: taxes were going up, with the main reason cited as gloomy numbers provided by the OBR, specifically its conclusion that the UK had become less productive, investing more but yielding less.

And so! It came to pass. Despite what Telegraph editorials and Tory broadcast rounds suggested over the weekend, that is essentially what happened during the budget, which was big and painful and bleak.

The Misleading Alibi

The way in which Reeves misled us was her alibi, because those OBR forecasts did not force her hand. She might have chosen different options; she could have given alternative explanations, even during the statement. Before last year's election, Starmer promised precisely this kind of people power. "The promise of democracy. The power of the vote. The potential for national renewal."

A year on, yet it's powerlessness that jumps out from Reeves's pre-budget speech. Our first Labour chancellor for a decade and a half casts herself to be an apolitical figure at the mercy of forces beyond her control: "Given the circumstances of the persistent challenges with our productivity … any finance minister of any party would be standing here today, confronting the decisions that I face."

She certainly make a choice, only not one the Labour party cares to publicize. Starting April 2029 UK workers and businesses are set to be paying an additional £26bn annually in tax – and the majority of this will not be spent on improved healthcare, new libraries, or enhanced wellbeing. Regardless of what nonsense is spouted by Nigel Farage, Badenoch and their allies, it isn't being lavished upon "benefits street".

Where the Cash Actually Ends Up

Instead of being spent, over 50% of the additional revenue will instead provide Reeves cushion for her self-imposed budgetary constraints. About 25% is allocated to paying for the government's own policy reversals. Examining the OBR's calculations and giving maximum benefit of the doubt to a Labour chancellor, only 17% of the tax take will fund genuinely additional spending, for example abolishing the two-child cap on child benefit. Its abolition "will cost" the Treasury a mere £2.5bn, because it had long been an act of political theatre from George Osborne. This administration should have have binned it in its first 100 days.

The Real Target: The Bond Markets

Conservatives, Reform and all of Blue Pravda have spent days barking about the idea that Reeves conforms to the caricature of Labour chancellors, soaking strivers to spend on the workshy. Labour backbenchers are cheering her budget as balm to their troubled consciences, protecting the most vulnerable. Both sides could be completely mistaken: The Chancellor's budget was largely targeted towards asset managers, speculative capital and participants within the financial markets.

The government could present a compelling argument for itself. The forecasts from the OBR were insufficient for comfort, especially considering bond investors demand from the UK the highest interest rate among G7 rich countries – exceeding that of France, that recently lost its leader, higher than Japan which has far greater debt. Combined 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.

It's understandable why those folk with red rosettes might not couch it this way when they visit #Labourdoorstep. As one independent adviser to Downing Street puts it, Reeves has effectively "utilised" financial markets as an instrument of discipline against Labour MPs and the voters. It's the reason Reeves can't resign, regardless of which promises she breaks. It is also why Labour MPs will have to knuckle down and support measures that cut billions from social security, as Starmer indicated yesterday.

Missing Statecraft and a Broken Promise

What is absent here is any sense of statecraft, of harnessing the finance ministry and the central bank to reach a new accommodation with investors. Also absent is any intuitive knowledge of voters,