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This accusation carries significant weight: suggesting Rachel Reeves has lied to Britons, spooking them into accepting massive additional taxes that could be used for increased benefits. However hyperbolic, this is not usual Westminster bickering; on this occasion, the stakes are more serious. Just last week, critics aimed at Reeves and Keir Starmer had been calling their budget "a shambles". Today, it's branded as lies, and Kemi Badenoch calling for Reeves to step down.

Such a serious accusation requires clear responses, so here is my view. Did the chancellor lied? On current evidence, apparently not. She told no blatant falsehoods. But, notwithstanding Starmer's yesterday's remarks, it doesn't follow that there is nothing to see and we should move on. The Chancellor did mislead the public about the factors shaping her decisions. Was it to funnel cash towards "benefits street", as the Tories claim? No, and the figures prove it.

A Standing Sustains Another Blow, But Facts Must Prevail

The Chancellor has sustained a further hit to her standing, however, should facts still matter in politics, Badenoch should stand down her attack dogs. Maybe the resignation recently of OBR head, Richard Hughes, over the leak of its own documents will quench Westminster's appetite for scandal.

But the real story is much more unusual than media reports suggest, and stretches broader and deeper beyond the political futures of Starmer and his class of '24. Fundamentally, this is a story concerning what degree of influence you and I have over the running of the nation. And it should worry you.

First, on to the Core Details

When the OBR released last Friday some of the projections it shared with Reeves while she prepared the budget, the shock was immediate. Not only had the OBR never done such a thing before (an "unusual step"), its figures apparently contradicted Reeves's statements. While rumors from Westminster suggested how bleak the budget would have to be, the watchdog's forecasts were getting better.

Take the government's so-called "iron-clad" rule, stating by 2030 day-to-day spending on hospitals, schools, and the rest would be wholly paid for by taxes: at the end of 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 unprecedented it forced breakfast TV to interrupt its usual fare. Several weeks before the actual budget, the nation was warned: taxes were going up, with the main reason being gloomy numbers provided by the OBR, specifically its finding that the UK was less efficient, investing more but yielding less.

And lo! It came to pass. Despite what Telegraph editorials combined with Tory media appearances suggested recently, that is basically what transpired at the budget, that proved to be big and painful and bleak.

The Deceptive Justification

Where Reeves misled us was her justification, since those OBR forecasts did not force her hand. She could have chosen other choices; she might have provided other reasons, even during the statement. Prior to the recent election, Starmer pledged exactly such people power. "The promise of democracy. The strength of the vote. The possibility for national renewal."

One year later, yet it's powerlessness that jumps out in Reeves's breakfast speech. Our first Labour chancellor in 15 years portrays herself as an apolitical figure buffeted by factors beyond her control: "In the context of the long-term challenges with our productivity … any chancellor of any party would be standing here today, facing the choices that I face."

She did make decisions, just not one Labour wishes to publicize. Starting April 2029 British workers as well as businesses will be contributing an additional £26bn annually in tax – but most of that will not be spent on better hospitals, public services, or enhanced wellbeing. Regardless of what nonsense is spouted by Nigel Farage, Badenoch and their allies, it isn't getting splashed on "welfare claimants".

Where the Cash Really Goes

Instead of going on services, over 50% of this extra cash will in fact give Reeves a buffer against her self-imposed fiscal rules. About 25% goes on paying for the administration's policy reversals. Examining the watchdog's figures and giving maximum benefit of the doubt towards a Labour chancellor, only 17% of the taxes will fund genuinely additional spending, for example abolishing the two-child cap on child benefit. Its abolition "will cost" the Treasury only £2.5bn, because it was always a bit of theatrical cruelty from George Osborne. This administration could and should abolished it immediately upon taking office.

The True Audience: Financial Institutions

The Tories, Reform and the entire Blue Pravda have been barking about how Reeves fits the stereotype of Labour chancellors, taxing hard workers to spend on the workshy. Labour backbenchers have been cheering her budget as a relief for their troubled consciences, protecting the disadvantaged. Each group are 180-degrees wrong: Reeves's budget was primarily targeted towards investment funds, speculative capital and participants within the bond markets.

The government could present a compelling argument in its defence. The forecasts provided by the OBR were insufficient to feel secure, particularly given that lenders charge the UK the highest interest rate of all G7 rich countries – exceeding that of France, that recently lost a prime minister, and exceeding Japan which has way more debt. Combined with our policies to hold down fuel bills, prescription charges and train fares, Starmer and Reeves can say their plan enables the central bank to reduce interest rates.

It's understandable that those folk with red rosettes may choose not to frame it in such terms next time they're on the doorstep. According to a consultant for Downing Street puts it, Reeves has "weaponised" financial markets as a tool of discipline over Labour MPs and the voters. It's why Reeves cannot resign, no matter what promises are broken. It's the reason Labour MPs will have to knuckle down and vote that cut billions from social security, as Starmer indicated yesterday.

A Lack of Political Vision , an Unfulfilled Pledge

What is absent here is any sense of statecraft, of harnessing the finance ministry and the Bank to forge a fresh understanding with markets. Also absent is innate understanding of voters,