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The charge represents a grave matter: that Rachel Reeves may have deceived UK citizens, spooking them to accept massive additional taxes that would be spent on increased welfare payments. However hyperbolic, this isn't usual Westminster bickering; on this occasion, the consequences are more serious. A week ago, detractors aimed at Reeves and Keir Starmer had been calling their budget "a mess". Today, it's denounced as falsehoods, with Kemi Badenoch calling for Reeves to step down.

Such a grave charge requires clear answers, therefore let me provide my view. Has the chancellor tell lies? On current information, no. She told no blatant falsehoods. However, despite Starmer's yesterday's comments, that doesn't mean there's nothing to see and we can all move along. The Chancellor did mislead the public about the factors informing her choices. Was it to funnel cash to "welfare recipients", as the Tories assert? No, and the figures prove this.

A Standing Takes A Further Blow, Yet Truth Must Win Out

Reeves has sustained another hit to her reputation, however, if facts still have anything to do with politics, Badenoch ought to stand down her attack dogs. Maybe the resignation yesterday of the Office for Budget Responsibility (OBR) chief, Richard Hughes, over the leak of its internal documents will satisfy SW1's thirst for blood.

But the real story is much more unusual than media reports suggest, and stretches broader and deeper than the political futures of Starmer and the 2024 intake. Fundamentally, this is a story about what degree of influence the public have in the governance of the nation. This should concern you.

Firstly, to Brass Tacks

When the OBR released recently some of the projections it provided to Reeves as she prepared the red book, the surprise was immediate. Not merely had the OBR never acted this way before (an "rare action"), its figures apparently contradicted the chancellor's words. While leaks from Westminster were about the grim nature of the budget was going to be, the OBR's own forecasts were improving.

Consider the Treasury's most "iron-clad" fiscal rule, that by 2030 daily spending on hospitals, schools, and other services must be completely paid for by taxes: at the end of October, the watchdog reckoned it would barely be met, albeit by a minuscule margin.

Several days later, Reeves gave a media briefing so unprecedented it forced breakfast TV to interrupt its regular schedule. Weeks before the real budget, the country was warned: taxes would rise, with the main reason cited as pessimistic numbers provided by the OBR, in particular its finding suggesting the UK was less productive, investing more but getting less out.

And lo! It happened. Notwithstanding the implications from Telegraph editorials combined with Tory media appearances implied over the weekend, that is basically what happened during the budget, which was significant, harsh, and grim.

The Misleading Alibi

The way in which Reeves deceived us was her alibi, because those OBR forecasts did not compel her actions. She might have chosen different options; she might have given other reasons, including during the statement. Prior to the recent election, Starmer pledged precisely this kind of public influence. "The hope of democracy. The power of the vote. The potential for national renewal."

One year later, and it's a lack of agency that jumps out from Reeves's breakfast speech. Our 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 long-term challenges with our productivity … any chancellor of any party would be standing here today, facing the decisions that I face."

She certainly make a choice, just not one Labour wishes to publicize. From April 2029 British workers as well as businesses will be paying another £26bn a year in taxes – but the majority of this will not be funding improved healthcare, public services, or enhanced wellbeing. Whatever bilge is spouted by Nigel Farage, Badenoch and their allies, it is not being lavished upon "benefits street".

Where the Cash Actually Ends Up

Instead of going on services, more than 50% of the additional revenue will in fact provide Reeves a buffer for her self-imposed budgetary constraints. About 25% is allocated to paying for the administration's U-turns. Reviewing the OBR's calculations and being as generous as possible towards Reeves, only 17% of the tax take will go on genuinely additional spending, for example scrapping the two-child cap on child benefit. Its abolition "costs" the Treasury only £2.5bn, as it was always a bit of political theatre from George Osborne. This administration could and should abolished it immediately upon taking office.

The Real Target: The Bond Markets

The Tories, Reform along with all of right-wing media have been barking about the idea that Reeves fits the caricature of left-wing finance ministers, taxing strivers to spend on shirkers. Party MPs are cheering her budget for being a relief to their troubled consciences, safeguarding the most vulnerable. Each group could be completely mistaken: Reeves's budget was primarily aimed at investment funds, hedge funds and participants within the financial markets.

Downing Street could present a compelling argument for itself. The margins provided by the OBR were deemed too small to feel secure, especially considering lenders demand from the UK the greatest borrowing cost among G7 developed nations – higher than France, which lost a prime minister, and exceeding Japan that carries way more debt. Combined with our measures to hold down fuel bills, prescription charges as well as train fares, Starmer together with Reeves can say this budget enables the Bank of England to cut interest rates.

You can see why those wearing Labour badges may choose not to frame it in such terms next time they visit #Labourdoorstep. As a consultant for Downing Street says, Reeves has "utilised" financial markets as an instrument of discipline over her own party and the voters. It's why the chancellor can't resign, no matter what pledges are broken. It is also 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 Statecraft , an Unfulfilled Promise

What is absent here is the notion of strategic governance, of mobilising the finance ministry and the Bank to forge a fresh understanding with markets. Also absent is any intuitive knowledge of voters,