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The allegation represents a grave matter: that Rachel Reeves has lied to the British public, frightening them into accepting billions in extra taxes that would be spent on increased benefits. However hyperbolic, this isn't usual Westminster bickering; this time, the consequences are higher. A week ago, detractors aimed at Reeves alongside Keir Starmer were calling their budget "a shambles". Now, it is denounced as lies, with Kemi Badenoch demanding Reeves to step down.

Such a serious charge demands clear answers, so here is my view. Has the chancellor lied? Based on current evidence, no. She told no whoppers. However, despite Starmer's yesterday's remarks, it doesn't follow that there is no issue here and we should move on. The Chancellor did mislead the public regarding the factors informing her decisions. Was it to channel cash to "welfare recipients", like the Tories claim? No, and the numbers prove this.

A Standing Sustains Another Blow, But Facts Must Win Out

Reeves has sustained another blow to her standing, however, if facts still have anything to do with politics, Badenoch should call off her lynch mob. Maybe the stepping down yesterday of OBR head, Richard Hughes, due to the leak of its internal documents will quench SW1's appetite for scandal.

Yet the real story is much more unusual compared to media reports suggest, and stretches wider and further beyond the careers of Starmer and the 2024 intake. At its heart, herein lies an account about what degree of influence you and I have over the running of the nation. This should concern everyone.

First, to Brass Tacks

After the OBR released last Friday some of the forecasts it shared with Reeves as she wrote the budget, the shock was immediate. Not merely has the OBR not acted this way before (described as an "exceptional move"), its numbers seemingly contradicted Reeves's statements. Even as leaks from Westminster suggested the grim nature of the budget would have to be, the watchdog's predictions were improving.

Take the government's most "iron-clad" rule, stating by 2030 day-to-day spending on hospitals, schools, and the rest would be completely paid for by taxes: in late October, the watchdog reckoned this would just about be met, albeit by a tiny margin.

A few days later, Reeves held a press conference so extraordinary it forced morning television to break from its regular schedule. Several weeks before the actual budget, the country was warned: taxes were going up, with the primary cause being gloomy numbers from the OBR, in particular its finding suggesting the UK was less productive, investing more but yielding less.

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

The Deceptive Alibi

The way in which Reeves misled us was her justification, because those OBR forecasts did not compel her actions. She could have chosen different options; she might have given other reasons, even during the statement. Prior to the recent election, Starmer pledged precisely this kind of people power. "The hope of democracy. The strength of the vote. The possibility for national renewal."

A year on, and it is a lack of agency that jumps out from Reeves's breakfast speech. The first Labour chancellor in 15 years portrays herself to be an apolitical figure buffeted by factors beyond her control: "In the context of the persistent challenges on our productivity … any finance minister of any political stripe would be standing here today, facing the decisions that I face."

She did make a choice, just not the kind Labour wishes to publicize. Starting April 2029 British workers as well as businesses are set to be contributing another £26bn a year in tax – but most of that will not go towards funding improved healthcare, new libraries, or enhanced wellbeing. Whatever nonsense is spouted by Nigel Farage, Badenoch and their allies, it isn't being lavished upon "benefits street".

Where the Money Really Goes

Instead of going on services, more than 50% of the additional revenue will instead give Reeves a buffer against her own budgetary constraints. About 25% goes on covering the government's own policy reversals. 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 genuinely additional spending, such as scrapping the two-child cap on child benefit. Its abolition "will cost" the Treasury a mere £2.5bn, as it had long been an act of theatrical cruelty from George Osborne. This administration could and should abolished it in its first 100 days.

The Real Target: Financial Institutions

The Tories, Reform and the entire Blue Pravda have been barking about the idea that Reeves conforms to the caricature of left-wing finance ministers, soaking hard workers to fund the workshy. Labour backbenchers are applauding her budget as a relief for their troubled consciences, protecting the disadvantaged. Each group could be completely mistaken: Reeves's budget was primarily targeted towards investment funds, speculative capital and the others in the bond markets.

Downing Street could present a strong case for itself. The forecasts provided by the OBR were too small for comfort, especially considering bond investors demand from the UK the greatest borrowing cost of all G7 rich countries – exceeding that of France, which lost its leader, higher than Japan that carries 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 enables the Bank of England to cut its key lending rate.

You can see that those folk with Labour badges may choose not to frame it in such terms next time they're on the doorstep. As a consultant for Downing Street says, Reeves has effectively "weaponised" financial markets as a tool of discipline over Labour MPs and the voters. This is the reason the chancellor can't resign, no matter what pledges she breaks. It's the reason Labour MPs will have to knuckle down and support measures to take billions off social security, as Starmer promised recently.

Missing Statecraft , an Unfulfilled Pledge

What's missing from this is any sense of strategic governance, of harnessing the finance ministry and the Bank to reach a new accommodation with investors. Missing too is any intuitive knowledge of voters,