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The accusation carries significant weight: that Rachel Reeves may have lied to the British public, spooking them to accept billions in extra taxes which could be funneled into increased benefits. However exaggerated, this isn't typical Westminster bickering; this time, the consequences are higher. A week ago, detractors of Reeves and Keir Starmer had been labeling their budget "chaotic". Now, it is branded as falsehoods, with Kemi Badenoch demanding the chancellor's resignation.

Such a grave accusation demands straightforward responses, so let me provide my assessment. Did the chancellor tell lies? On current information, no. There were no whoppers. But, despite Starmer's yesterday's remarks, that doesn't mean there is no issue here and we can all move along. Reeves did misinform the public regarding the considerations informing her decisions. Was this all to funnel cash to "benefits street", as the Tories assert? No, and the numbers demonstrate this.

A Standing Takes Another Blow, But Facts Must Win Out

The Chancellor has taken a further blow to her standing, however, if facts still have anything to do with politics, Badenoch ought to stand down her attack dogs. Perhaps the stepping down yesterday of OBR head, Richard Hughes, over the unauthorized release of its internal documents will satisfy SW1's thirst for blood.

Yet the true narrative is much more unusual compared to the headlines suggest, and stretches broader and deeper than the careers of Starmer and his class of '24. At its heart, this is a story about how much say the public get over the governance of the nation. And it concern you.

First, to Brass Tacks

After the OBR released recently a portion of the projections it shared with Reeves while she wrote the red book, the shock was instant. Not only has the OBR never acted this way before (an "exceptional move"), its numbers seemingly went against Reeves's statements. While rumors from Westminster suggested the grim nature of the budget would have to be, the watchdog's forecasts were improving.

Take the Treasury's so-called "unbreakable" rule, stating by 2030 day-to-day spending for hospitals, schools, and other services must be completely funded by taxes: in late October, the watchdog calculated this would just about be met, albeit only by a minuscule margin.

A few days later, Reeves held a media briefing so extraordinary it forced morning television to interrupt its regular schedule. Several weeks before the actual budget, the country was put on alert: taxes were going up, with the main reason cited as gloomy numbers from the OBR, in particular its finding that the UK had become less efficient, investing more but getting less out.

And so! It happened. Notwithstanding what Telegraph editorials and Tory broadcast rounds suggested over the weekend, that is essentially what transpired during the budget, which was big and painful and bleak.

The Misleading Alibi

Where Reeves misled us concerned her alibi, because those OBR forecasts didn't compel her actions. She might have chosen other choices; she could have given alternative explanations, including on budget day itself. Before last year's election, Starmer promised exactly such people power. "The promise of democracy. The strength of the vote. The possibility for national renewal."

A year on, yet it is a lack of agency that jumps out in Reeves's pre-budget speech. The first Labour chancellor in 15 years portrays herself as a technocrat buffeted by factors outside her influence: "Given the circumstances of the long-term challenges on our productivity … any finance minister of any political stripe would be in this position today, facing the choices that I face."

She did make decisions, just not the kind Labour wishes to publicize. Starting April 2029 British workers and businesses will be paying another £26bn a year in tax – and most of that will not go towards spent on improved healthcare, public services, or happier lives. Regardless of what bilge is spouted by Nigel Farage, Badenoch and their allies, it is not getting splashed on "benefits street".

Where the Cash Really Goes

Rather than going on services, more than 50% of the additional revenue will instead provide Reeves a buffer against her own budgetary constraints. Approximately 25% is allocated to paying for the government's own policy reversals. Examining the OBR's calculations and giving maximum benefit of the doubt towards Reeves, only 17% of the tax take will go on actual new spending, such as scrapping the two-child cap on child benefit. Its abolition "will cost" the Treasury a mere £2.5bn, as it was always an act of theatrical cruelty from George Osborne. This administration should have have binned it immediately upon taking office.

The True Audience: The Bond Markets

Conservatives, Reform and the entire Blue Pravda have spent days barking about how Reeves fits the caricature of left-wing finance ministers, soaking hard workers to fund the workshy. Party MPs have been cheering her budget for being a relief for their social concerns, protecting the most vulnerable. Both sides are completely mistaken: Reeves's budget was primarily aimed at asset managers, speculative capital and the others in the financial markets.

Downing Street could present a strong case in its defence. The forecasts from the OBR were too small to feel secure, especially given that bond investors demand from the UK the highest interest rate among G7 developed nations – exceeding that of France, which lost its leader, higher than Japan that carries far greater debt. Coupled with the policies to hold down fuel bills, prescription charges as well as train fares, Starmer and Reeves argue this budget allows the central bank to reduce its key lending rate.

You can see that those wearing Labour badges may choose not to frame it this way when they're on the doorstep. According to one independent adviser for Downing Street says, Reeves has effectively "utilised" financial markets to act as an instrument of control over her own party and the voters. It's why Reeves can't resign, regardless of which pledges she breaks. It's why Labour MPs must fall into line and support measures that cut billions from social security, as Starmer promised yesterday.

A Lack of Statecraft , a Broken Pledge

What is absent here is the notion of statecraft, of mobilising the Treasury and the Bank to forge a new accommodation with markets. Missing too is any intuitive knowledge of voters,