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This allegation is a serious one: suggesting Rachel Reeves has deceived UK citizens, spooking them to accept billions in extra taxes that would be spent on increased welfare payments. However hyperbolic, this isn't usual political bickering; this time, the consequences could be damaging. A week ago, detractors aimed at Reeves and Keir Starmer were labeling their budget "a shambles". Today, it's denounced as lies, and Kemi Badenoch demanding Reeves to step down.

This serious accusation demands straightforward answers, so here is my assessment. Has the chancellor lied? Based on current evidence, apparently not. There were no blatant falsehoods. But, notwithstanding Starmer's yesterday's comments, it doesn't follow that there's nothing to see and we can all move along. Reeves did misinform the public regarding the factors shaping her choices. Was this all to funnel cash towards "benefits street", like the Tories claim? No, and the figures prove this.

A Standing Sustains A Further Hit, But Facts Should Win Out

The Chancellor has sustained another blow to her standing, but, if facts continue to matter in politics, Badenoch should call off her lynch mob. Maybe the stepping down yesterday of OBR head, Richard Hughes, over the leak of its internal documents will quench SW1's appetite for scandal.

But the real story is much more unusual than media reports suggest, extending broader and deeper than the political futures of Starmer and the 2024 intake. Fundamentally, herein lies an account concerning what degree of influence you and I get over the governance of our own country. This should concern you.

First, on to the Core Details

After the OBR released last Friday some of the forecasts it shared with Reeves as she prepared the budget, the surprise was immediate. Not merely had the OBR not done such a thing before (described as an "exceptional move"), its numbers seemingly contradicted Reeves's statements. While rumors from Westminster were about how bleak the budget would have to be, the watchdog's predictions were getting better.

Consider the government's so-called "unbreakable" fiscal rule, that by 2030 day-to-day spending on hospitals, schools, and the rest must be completely paid for by taxes: at the end of October, the OBR reckoned this would just about be met, albeit by a tiny margin.

Several days later, Reeves held a press conference so unprecedented it forced breakfast TV to break from its usual fare. Several 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, specifically its conclusion suggesting the UK had become less productive, investing more but getting less out.

And lo! It happened. Despite the implications from Telegraph editorials combined with Tory broadcast rounds implied over the weekend, this is basically what happened at the budget, that proved to be significant, harsh, and grim.

The Misleading Alibi

Where Reeves misled us was her alibi, since these OBR forecasts didn't compel her actions. She could have chosen different options; she might have given alternative explanations, including during the statement. Before last year's election, Starmer promised precisely this kind of public influence. "The promise of democracy. The strength of the vote. The potential for national renewal."

A year on, and it is powerlessness that is evident from Reeves's pre-budget speech. Our first Labour chancellor in 15 years casts herself to be an apolitical figure at the mercy of factors outside her influence: "Given the circumstances of the persistent challenges with our productivity … any finance minister of any party would be in this position today, confronting the choices that I face."

She did make decisions, only not the kind the Labour party wishes to broadcast. Starting April 2029 British workers and businesses will be contributing an additional £26bn a year in tax – and most of that will not be funding improved healthcare, new libraries, or happier lives. Regardless of what bilge comes from Nigel Farage, Badenoch and others, it is not being lavished upon "benefits street".

Where the Money Really Goes

Instead of being spent, over 50% of this additional revenue will instead provide Reeves a buffer against her own fiscal rules. Approximately 25% is allocated to covering the government's own U-turns. Reviewing the OBR's calculations and being as generous as possible to a Labour chancellor, a mere 17% of the taxes will fund actual new spending, such as scrapping the limit on child benefit. Removing it "costs" the Treasury only £2.5bn, because it had long been an act of political theatre from George Osborne. This administration should have abolished it immediately upon taking office.

The Real Target: Financial Institutions

The Tories, Reform along with all of right-wing media have been railing against how Reeves conforms to the caricature of left-wing finance ministers, taxing hard workers to spend on shirkers. Party MPs have been cheering her budget for being a relief for their troubled consciences, protecting the disadvantaged. Both sides could be completely mistaken: Reeves's budget was primarily aimed at asset managers, speculative capital and participants within the bond markets.

The government can make a strong case for itself. The margins provided by the OBR were deemed too small to feel secure, especially considering lenders charge the UK the highest interest rate of all G7 rich countries – higher than France, which lost its leader, higher than Japan that carries way more debt. Combined with our 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 cut its key lending rate.

It's understandable that those wearing Labour badges might not frame it this way when they visit #Labourdoorstep. According to a consultant to Downing Street says, Reeves has "utilised" financial markets as a tool of discipline over Labour MPs and the electorate. It's the reason the chancellor cannot resign, no matter what promises she breaks. It's why Labour MPs must fall into line and vote that cut billions from social security, as Starmer indicated yesterday.

Missing Statecraft and a Broken Promise

What's missing here is the notion of statecraft, of harnessing the finance ministry and the central bank to forge a fresh understanding with investors. Also absent is intuitive knowledge of voters,