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The charge is a serious one: suggesting Rachel Reeves has misled the British public, scaring them into accepting billions in extra taxes that could be used for increased welfare payments. However hyperbolic, this is not typical Westminster bickering; this time, the stakes could be damaging. Just last week, critics aimed at Reeves alongside Keir Starmer had been labeling their budget "uncoordinated". Today, it's denounced as falsehoods, and Kemi Badenoch demanding Reeves to step down.

Such a serious accusation requires straightforward responses, therefore here is my view. Did the chancellor been dishonest? On current evidence, no. She told no major untruths. However, notwithstanding Starmer's recent comments, it doesn't follow that there is no issue here and we can all move along. The Chancellor did mislead the public about the considerations shaping her decisions. Was this all to funnel cash towards "welfare recipients", like the Tories claim? No, and the numbers prove it.

A Reputation Takes Another Blow, But Facts Should Prevail

Reeves has taken a further hit to her reputation, 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 unauthorized release of its own documents will satisfy SW1's thirst for blood.

But the real story is much more unusual than the headlines indicate, extending broader and deeper beyond the political futures of Starmer and his class of '24. Fundamentally, this is an account about what degree of influence the public have in the governance of the nation. And it should worry everyone.

First, on to Brass Tacks

After the OBR released last Friday a portion of the forecasts it shared with Reeves while she wrote the budget, the surprise was immediate. Not only had the OBR not acted this way before (described as an "unusual step"), its numbers seemingly went against the chancellor's words. While leaks from Westminster were about how bleak the budget was going to be, the watchdog's predictions were improving.

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

A few days later, Reeves held a media briefing so extraordinary that it caused breakfast TV to break from its regular schedule. Weeks before the real budget, the nation was warned: taxes were going up, and the main reason being pessimistic numbers provided by the OBR, in particular its conclusion that the UK was less efficient, investing more but yielding less.

And so! It happened. Despite the implications from Telegraph editorials and Tory media appearances implied recently, that is basically what happened during the budget, that proved to be significant, harsh, and grim.

The Misleading Justification

Where Reeves misled us was her justification, because those OBR forecasts didn't force her hand. She could have chosen different options; she might have given other reasons, including during the statement. Before the recent election, Starmer promised exactly such people power. "The hope of democracy. The power of the vote. The possibility for national renewal."

A year on, and it is a lack of agency that is evident in Reeves's pre-budget speech. The first Labour chancellor for a decade and a half casts herself as an apolitical figure at the mercy of factors beyond her control: "Given the circumstances of the persistent challenges on our productivity … any chancellor of any political stripe would be in this position today, confronting the choices that I face."

She certainly make a choice, just not the kind Labour wishes to broadcast. Starting April 2029 British workers as well as businesses are set to be paying an additional £26bn a year in taxes – and the majority of this will not go towards funding improved healthcare, public services, or happier lives. Whatever nonsense comes from Nigel Farage, Badenoch and their allies, it isn't being lavished upon "benefits street".

Where the Cash Actually Ends Up

Rather than going on services, over 50% of this additional revenue will instead provide Reeves a buffer against her own budgetary constraints. Approximately 25% goes on covering the government's own policy reversals. Reviewing the OBR's calculations and giving maximum benefit of the doubt towards a Labour chancellor, only 17% of the taxes will fund actual new spending, such as scrapping the limit on child benefit. Its abolition "will cost" the Treasury only £2.5bn, because it was always an act of political theatre from George Osborne. This administration could and should have binned it immediately upon taking office.

The Real Target: The Bond Markets

Conservatives, Reform and all of right-wing media have been barking about the idea that Reeves fits the caricature of Labour chancellors, soaking hard workers to spend on the workshy. Labour backbenchers have been cheering her budget as a relief for their troubled consciences, protecting the most vulnerable. Each group could be 180-degrees wrong: Reeves's budget was largely targeted towards asset managers, hedge funds and participants within the financial markets.

The government could present a compelling argument in its defence. The margins provided by the OBR were insufficient to feel secure, especially given that bond investors demand from the UK the highest interest rate among G7 developed nations – higher than France, which lost a prime minister, higher than Japan that carries way more debt. Combined with our measures to hold down fuel bills, prescription charges as well as train fares, Starmer and Reeves can say this budget enables the central bank to cut interest rates.

You can see that those folk with red rosettes might not couch it this way next time they visit #Labourdoorstep. As a consultant to Downing Street puts it, Reeves has "utilised" the bond market to act as a tool of control against Labour MPs and the electorate. It's why Reeves cannot resign, regardless of which promises are broken. It's the reason Labour MPs will have to knuckle down and vote that cut billions from social security, just as Starmer indicated recently.

A Lack of Political Vision , a Broken Promise

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