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The allegation is a serious one: suggesting Rachel Reeves has lied to the British public, spooking them into accepting billions in extra taxes that could be funneled into higher benefits. While hyperbolic, this is not usual political sparring; on this occasion, the stakes are higher. Just last week, detractors aimed at Reeves and Keir Starmer were labeling their budget "a shambles". Today, it's denounced as falsehoods, and Kemi Badenoch calling for the chancellor's resignation.

Such a grave accusation demands straightforward answers, so let me provide my assessment. Has the chancellor been dishonest? Based on current evidence, no. She told no whoppers. However, despite Starmer's recent remarks, that doesn't mean there is nothing to see and we should move on. Reeves did misinform the public regarding the factors shaping her decisions. Was this all to channel cash towards "benefits street", like the Tories assert? Certainly not, and the numbers prove this.

A Reputation Takes Another Blow, But Facts Should Prevail

Reeves has taken a further hit to her standing, however, if facts continue to matter in politics, Badenoch ought to call off her lynch mob. Maybe the resignation yesterday of OBR head, Richard Hughes, due to the unauthorized release of its internal documents will quench SW1's thirst for blood.

But the true narrative is much more unusual compared to the headlines indicate, and stretches broader and deeper than the political futures of Starmer and the class of '24. At its heart, this is a story concerning how much say you and I get in the governance of the nation. And it concern you.

First, to the Core Details

After the OBR published recently a portion of the forecasts it shared with Reeves as she wrote the red book, the shock was immediate. Not only had the OBR not acted this way before (described as an "unusual step"), its figures seemingly went against Reeves's statements. Even as rumors from Westminster suggested how bleak the budget was going to be, the watchdog's forecasts were improving.

Take the government's so-called "unbreakable" fiscal rule, stating by 2030 daily spending on hospitals, schools, and the rest would be wholly funded by taxes: at the end of October, the watchdog calculated this would barely be met, albeit only by a minuscule margin.

Several days later, Reeves held a press conference so extraordinary it forced breakfast TV to interrupt its regular schedule. Weeks before the actual budget, the country was put on alert: taxes were going up, with the main reason being pessimistic numbers provided by the OBR, specifically its conclusion suggesting the UK had become less productive, putting more in but getting less out.

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

The Deceptive Justification

Where Reeves deceived us concerned her justification, since these OBR forecasts didn't force her hand. She might have chosen different options; she might have provided alternative explanations, including on budget day itself. Prior to the recent election, Starmer promised precisely this kind of people power. "The hope of democracy. The power of the vote. The possibility for national renewal."

A year on, and it is powerlessness that jumps out from Reeves's pre-budget speech. The first Labour chancellor in 15 years portrays herself to be an apolitical figure at the mercy of forces 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, facing the choices that I face."

She did make decisions, just not the kind the Labour party cares to broadcast. Starting April 2029 British workers and businesses are set to be paying an additional £26bn a year in taxes – and most of that will not go towards spent on better hospitals, public services, or enhanced wellbeing. Regardless of what nonsense comes from Nigel Farage, Badenoch and others, it is not getting splashed on "welfare claimants".

Where the Cash Actually Ends Up

Instead of being spent, more than 50% of the extra cash will instead provide Reeves a buffer against her self-imposed budgetary constraints. Approximately 25% goes on covering the government's own U-turns. Reviewing the watchdog's figures and being as generous as possible to Reeves, only 17% of the taxes will go on genuinely additional spending, such as abolishing the two-child cap on child benefit. Its abolition "costs" the Treasury only £2.5bn, because it had long been a bit of theatrical cruelty from George Osborne. This administration should have abolished 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 conforms to the stereotype of Labour chancellors, soaking hard workers to spend on the workshy. Party MPs are cheering her budget as balm for their troubled consciences, safeguarding the most vulnerable. Both sides are 180-degrees wrong: Reeves's budget was primarily targeted towards asset managers, speculative capital and participants within the financial markets.

The government can make a strong case for itself. The forecasts from the OBR were insufficient for comfort, especially given that bond investors charge the UK the greatest borrowing cost among G7 developed nations – exceeding that of France, which lost a prime minister, and exceeding Japan that carries far greater debt. Combined with the measures to cap fuel bills, prescription charges as well as train fares, Starmer together with Reeves argue this budget allows the Bank of England to cut interest rates.

It's understandable why those wearing red rosettes may choose not to couch it in such terms when they're on #Labourdoorstep. As a consultant for Downing Street says, Reeves has "utilised" the bond market as an instrument of control against her own party and the voters. It's the reason the chancellor can't resign, no matter what promises she breaks. It is also why Labour MPs must knuckle down and vote to take billions off social security, as Starmer indicated yesterday.

Missing Statecraft , an Unfulfilled Pledge

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