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This allegation represents a grave matter: that Rachel Reeves has deceived UK citizens, scaring them to accept massive additional taxes which would be used for higher benefits. While hyperbolic, this is not typical political sparring; on this occasion, the stakes are more serious. A week ago, detractors aimed at Reeves alongside Keir Starmer had been labeling their budget "uncoordinated". Now, it's denounced as lies, with Kemi Badenoch demanding the chancellor's resignation.

This grave accusation demands clear answers, therefore here is my assessment. Did the chancellor lied? Based on current evidence, no. There were no whoppers. However, despite 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 about the factors informing her decisions. Was this all to channel cash to "welfare recipients", like the Tories assert? Certainly not, and the numbers demonstrate it.

A Reputation Sustains A Further Blow, Yet Truth Should Prevail

Reeves has taken a further hit to her standing, however, should facts continue to have anything to do with politics, Badenoch should call off her lynch mob. Perhaps the stepping down yesterday of the Office for Budget Responsibility (OBR) chief, Richard Hughes, due to the leak of its internal documents will quench Westminster's thirst for blood.

But the true narrative is far stranger compared to media reports indicate, and stretches broader and deeper beyond the careers of Starmer and the class of '24. At its heart, herein lies a story about what degree of influence you and I get over the governance of the nation. And it should worry everyone.

Firstly, on to the Core Details

After the OBR released recently some of the projections it provided to Reeves as she wrote the budget, the shock was immediate. Not only has the OBR never done such a thing before (an "exceptional move"), its figures seemingly contradicted Reeves's statements. Even as leaks from Westminster were about how bleak the budget was going to be, the OBR's own forecasts were improving.

Consider the government's so-called "iron-clad" fiscal rule, that by 2030 daily spending on hospitals, schools, and the rest must be completely paid for by taxes: in late October, the OBR calculated this would just about be met, albeit only by a tiny margin.

A few days later, Reeves gave a media briefing so unprecedented that it caused breakfast TV to interrupt its usual fare. Several weeks prior to the real budget, the country was put on alert: taxes would rise, with the primary cause being gloomy numbers from the OBR, in particular its finding suggesting the UK had become less productive, investing more but yielding less.

And so! It happened. Despite the implications from Telegraph editorials combined with Tory broadcast rounds implied recently, that is essentially what transpired at the budget, which was big and painful and bleak.

The Misleading Alibi

Where Reeves misled us concerned her alibi, because these OBR forecasts didn't compel her actions. She might have chosen other choices; she could have given other reasons, including 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."

A year on, and it's powerlessness that jumps out from Reeves's breakfast speech. Our first Labour chancellor for a decade and a half portrays herself as an apolitical figure at the mercy of forces beyond her control: "Given the circumstances of the long-term challenges on our productivity … any finance minister of any political stripe would be standing here today, confronting the decisions that I face."

She certainly make a choice, only not the kind Labour wishes to publicize. Starting April 2029 UK workers as well as businesses are set to be contributing an additional £26bn annually in taxes – but most of that will not be spent on better hospitals, new libraries, nor 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 Actually Ends Up

Instead of being spent, more than 50% of this extra cash will in fact provide Reeves a buffer for her self-imposed fiscal rules. Approximately 25% goes on covering the administration's policy reversals. Examining the watchdog's figures and giving maximum benefit of the doubt to a Labour chancellor, a mere 17% of the tax take will fund actual new spending, for example scrapping the two-child cap on child benefit. Removing it "will cost" the Treasury a mere £2.5bn, as it had long been an act of theatrical cruelty by George Osborne. A Labour government could and should have binned it immediately upon taking office.

The Real Target: The Bond Markets

The Tories, Reform along with the entire right-wing media have spent days barking about how Reeves fits the stereotype of left-wing finance ministers, soaking hard workers to fund shirkers. Labour backbenchers have been cheering her budget as a relief to their troubled consciences, safeguarding the most vulnerable. Each group could be completely mistaken: Reeves's budget was primarily aimed at asset managers, speculative capital and participants within the financial markets.

The government can make a compelling argument in its defence. The forecasts provided by the OBR were too small for comfort, particularly considering lenders demand from the UK the greatest borrowing cost of all G7 developed nations – exceeding that of France, which lost a prime minister, and exceeding Japan which has way more debt. Combined with the measures to hold down fuel bills, prescription charges as well as train fares, Starmer together with Reeves can say their plan allows the Bank of England to cut its key lending rate.

It's understandable that those wearing red rosettes might not frame it in such terms when they visit #Labourdoorstep. As one independent adviser to Downing Street puts it, Reeves has "weaponised" the bond market to act as a tool of discipline over her own party and the electorate. It's why Reeves cannot resign, no matter what pledges are broken. It is also the reason Labour MPs will have to knuckle down and support measures to take billions off social security, just as Starmer indicated recently.

A Lack of Political Vision and a Broken Promise

What is absent here is the notion of strategic governance, of mobilising the finance ministry and the central bank to reach a new accommodation with markets. Missing too is any intuitive knowledge of voters,