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The allegation is a serious one: that Rachel Reeves has deceived the British public, scaring them into accepting billions in additional taxes that would be funneled into higher benefits. However hyperbolic, this is not usual Westminster sparring; on this occasion, the stakes could be damaging. A week ago, critics aimed at Reeves alongside Keir Starmer had been labeling their budget "a shambles". Today, it's denounced as lies, and Kemi Badenoch demanding Reeves to step down.

This serious accusation demands clear answers, so here is my view. Has the chancellor tell lies? Based on the available information, no. There were no whoppers. But, despite Starmer's recent remarks, that doesn't mean there is no issue here and we can all move along. The Chancellor did mislead the public regarding the factors informing her decisions. Was it to channel cash to "benefits street", as the Tories claim? No, and the figures demonstrate it.

A Standing Sustains Another Blow, Yet Truth Should Prevail

The Chancellor has taken a further hit to her reputation, but, should facts continue to matter in politics, Badenoch should stand down her attack dogs. Perhaps the stepping down yesterday of OBR head, Richard Hughes, due to the leak of its own documents will satisfy Westminster's thirst for blood.

Yet the real story is far stranger compared to the headlines indicate, and stretches broader and deeper than the careers of Starmer and his class of '24. Fundamentally, this is a story concerning what degree of influence you and I get over the running of the nation. And it should worry you.

Firstly, to Brass Tacks

When the OBR released last Friday some of the forecasts it shared with Reeves as she wrote the budget, the surprise was instant. Not merely has the OBR never acted this way before (an "exceptional move"), its figures apparently went against Reeves's statements. Even as rumors from Westminster were about how bleak the budget was going to be, the watchdog's forecasts were improving.

Take the government's so-called "unbreakable" rule, that by 2030 day-to-day spending on hospitals, schools, and the rest must be completely funded by taxes: at the end of October, the watchdog calculated this would barely be met, albeit by a minuscule margin.

A few days later, Reeves gave a press conference so unprecedented it forced breakfast TV to interrupt its regular schedule. Several weeks before the real budget, the nation was put on alert: taxes were going up, and the main reason being pessimistic numbers from the OBR, in particular its conclusion suggesting the UK was less efficient, putting more in but yielding less.

And lo! It happened. Notwithstanding what Telegraph editorials combined with Tory media appearances implied over the weekend, that is basically what happened at the budget, that proved to be significant, harsh, and grim.

The Deceptive Alibi

The way in which Reeves deceived us was her alibi, since these OBR forecasts did not compel her actions. She could have made other choices; she might have provided alternative explanations, including during the statement. Prior to the recent election, Starmer promised exactly such people power. "The hope of democracy. The power of the vote. The potential for national renewal."

One year later, and it is powerlessness that is evident from Reeves's pre-budget speech. Our first Labour chancellor in 15 years casts herself to be a technocrat buffeted by factors beyond her control: "Given the circumstances of the long-term challenges with our productivity … any finance minister of any party would be standing here today, confronting the decisions that I face."

She did make a choice, only not the kind the Labour party cares to broadcast. Starting April 2029 British workers as well as businesses are set to be paying another £26bn a year in tax – and the majority of this will not be funding better hospitals, public services, or happier lives. Regardless of what bilge is spouted by Nigel Farage, Badenoch and others, it is not being lavished upon "benefits street".

Where the Cash Really Goes

Instead of being spent, more than 50% of the extra cash will in fact provide Reeves a buffer for her own fiscal rules. About 25% is allocated to covering the administration's U-turns. Examining the OBR's calculations and giving maximum benefit of the doubt towards a Labour chancellor, a mere 17% of the tax take will fund actual new spending, for example abolishing the two-child cap on child benefit. Its abolition "costs" the Treasury a mere £2.5bn, because it was always a bit of political theatre by George Osborne. This administration should have have binned it immediately upon taking office.

The True Audience: Financial Institutions

Conservatives, Reform and all of right-wing media have been barking about the idea that Reeves conforms to the stereotype of left-wing finance ministers, soaking hard workers to fund shirkers. Labour backbenchers are applauding her budget for being a relief to their troubled consciences, safeguarding the most vulnerable. Both sides are completely mistaken: Reeves's budget was primarily targeted towards investment funds, hedge funds and participants within the financial markets.

The government can make a strong case for itself. The margins from the OBR were insufficient to feel secure, especially given that bond investors charge the UK the greatest borrowing cost among G7 rich countries – higher than France, that recently lost its leader, higher than Japan which has far greater debt. Combined with the measures to hold down fuel bills, prescription charges and train fares, Starmer and Reeves argue their plan allows the central bank to reduce interest rates.

You can see why those wearing Labour badges may choose not to couch it in such terms next time they visit #Labourdoorstep. According to one independent adviser for Downing Street says, Reeves has effectively "utilised" the bond market as a tool of discipline over Labour MPs and the electorate. It's why Reeves can't resign, no matter what promises she breaks. It is also why Labour MPs will have to knuckle down and vote to take billions off social security, just as Starmer promised yesterday.

A Lack of Political Vision , an Unfulfilled Promise

What is absent here is any sense of statecraft, of mobilising the Treasury and the Bank to reach a fresh understanding with investors. Missing too is innate understanding of voters,