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This accusation carries significant weight: suggesting Rachel Reeves has misled the British public, frightening them to accept billions in additional taxes which would be spent on higher welfare payments. However exaggerated, this is not typical political bickering; this time, the consequences are higher. Just last week, detractors aimed at Reeves and Keir Starmer had been calling their budget "a shambles". Today, it's denounced as lies, and Kemi Badenoch demanding the chancellor to quit.

Such a serious charge requires clear answers, so let me provide my view. Has the chancellor tell lies? Based on current information, apparently not. There were no whoppers. However, notwithstanding Starmer's yesterday's remarks, it doesn't follow that there's nothing to see and we can all move along. The Chancellor did mislead the public about the factors shaping her choices. Was this all to channel cash towards "benefits street", as the Tories claim? No, as the figures demonstrate it.

A Reputation Sustains A Further Blow, Yet Truth Must Win Out

Reeves has taken another hit to her standing, but, if facts still have anything to do with politics, Badenoch ought to stand down her attack dogs. Perhaps the resignation yesterday of the Office for Budget Responsibility (OBR) chief, Richard Hughes, over the unauthorized release of its internal documents will quench SW1's appetite for scandal.

Yet the true narrative is much more unusual than media reports suggest, extending wider and further beyond the political futures of Starmer and the 2024 intake. At its heart, this is a story concerning how much say you and I have over the running of our own country. This should concern everyone.

Firstly, to the Core Details

After the OBR published recently a portion of the forecasts it provided to Reeves as she prepared the red book, the shock was instant. Not merely has the OBR not acted this way before (described as an "exceptional move"), its numbers apparently went against Reeves's statements. While leaks from Westminster were about how bleak the budget would have to be, the OBR's own predictions were getting better.

Take the Treasury's most "unbreakable" rule, that by 2030 day-to-day spending for hospitals, schools, and the rest must be wholly funded by taxes: in late October, the watchdog reckoned this would barely be met, albeit by a tiny margin.

A few days later, Reeves gave a media briefing so unprecedented that it caused morning television to interrupt its usual fare. Several weeks prior to the real budget, the country was put on alert: taxes were going up, with the primary cause cited as pessimistic numbers provided by the OBR, specifically its conclusion that the UK was less efficient, putting more in but yielding less.

And so! It came to pass. Notwithstanding what Telegraph editorials and Tory media appearances implied recently, this is essentially what happened at the budget, which was big and painful and bleak.

The Misleading Justification

Where Reeves misled us concerned her alibi, because these OBR forecasts did not compel her actions. She could have chosen different options; she might have given alternative explanations, even during the statement. Prior to last year's election, Starmer promised precisely this kind of public influence. "The promise of democracy. The strength of the vote. The possibility for national renewal."

One year later, yet it is a lack of agency that jumps out from Reeves's breakfast speech. Our first Labour chancellor for a decade and a half portrays herself to be a technocrat at the mercy of forces outside her influence: "Given the circumstances of the persistent challenges with our productivity … any finance minister of any political stripe would be in this position today, confronting the choices that I face."

She certainly make decisions, only not the kind the Labour party cares to broadcast. Starting April 2029 UK workers as well as businesses will be paying another £26bn annually in tax – but most of that will not be spent on better hospitals, public services, nor enhanced wellbeing. Whatever nonsense is spouted by Nigel Farage, Badenoch and others, it is not getting splashed on "benefits street".

Where the Money Actually Ends Up

Rather than being spent, over 50% of this extra cash will instead provide Reeves a buffer against her self-imposed budgetary constraints. About 25% is allocated to paying for the government's own U-turns. Examining the OBR's calculations and giving maximum benefit of the doubt towards a Labour chancellor, a mere 17% of the taxes will go on genuinely additional spending, such as scrapping the limit on child benefit. Removing it "will cost" the Treasury only £2.5bn, because it had long been an act of theatrical cruelty by George Osborne. This administration could and should have binned it in its first 100 days.

The Real Target: Financial Institutions

Conservatives, 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 cheering her budget for being a relief for their social concerns, protecting the disadvantaged. Each group are completely mistaken: The Chancellor's budget was largely aimed at asset managers, hedge funds and participants within the bond markets.

The government could present a compelling argument in its defence. The margins provided by the OBR were insufficient to feel secure, especially considering bond investors demand from the UK the greatest borrowing cost of all G7 rich countries – higher than France, that recently lost its leader, and exceeding Japan that carries way more debt. Coupled with the policies to cap fuel bills, prescription charges as well as train fares, Starmer and Reeves can say their plan enables the central bank to cut interest rates.

It's understandable why those folk with red rosettes might not couch it in such terms next time they visit the doorstep. According to a consultant for Downing Street says, Reeves has "utilised" financial markets to act as a tool of control over Labour MPs and the voters. This is why Reeves can't resign, regardless of which pledges are broken. It's the reason Labour MPs must knuckle down and vote that cut billions from social security, just as Starmer promised recently.

A Lack of Statecraft and an Unfulfilled Pledge

What's missing here is the notion of strategic governance, of harnessing the Treasury and the central bank to forge a fresh understanding with markets. Missing too is any intuitive knowledge of voters,