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The allegation carries significant weight: that Rachel Reeves has misled Britons, scaring them into accepting billions in additional taxes which could be funneled into higher benefits. However exaggerated, this is not usual political sparring; on this occasion, the stakes are higher. A week ago, critics aimed at Reeves alongside Keir Starmer were labeling their budget "a mess". Today, it is denounced as falsehoods, and Kemi Badenoch demanding Reeves to step down.

Such a serious accusation demands clear answers, so here is my assessment. Has the chancellor been dishonest? Based on the available information, no. She told no whoppers. However, notwithstanding Starmer's yesterday's comments, it doesn't follow that there's no issue here and we should move on. Reeves did mislead the public about the factors shaping her choices. Was it to channel cash towards "benefits street", like the Tories assert? No, and the numbers prove it.

A Standing Sustains A Further Hit, But Facts Must Prevail

Reeves has sustained another blow to her standing, however, should facts continue to have anything to do with politics, Badenoch should call off her attack dogs. Maybe the stepping down yesterday of OBR head, Richard Hughes, over the leak of its own documents will satisfy SW1's appetite for scandal.

Yet the true narrative is much more unusual compared to media reports suggest, extending wider and further than the careers of Starmer and the 2024 intake. Fundamentally, this is a story concerning what degree of influence the public have in the running of the nation. And it concern you.

Firstly, to the Core Details

After the OBR released last Friday a portion of the projections it provided to Reeves as she prepared the budget, the shock was immediate. Not only has the OBR not acted this way before (an "rare action"), its numbers seemingly contradicted Reeves's statements. While rumors from Westminster were about how bleak the budget was going to be, the watchdog's forecasts were improving.

Consider the government's so-called "unbreakable" fiscal rule, that by 2030 daily spending for hospitals, schools, and other services must be completely funded by taxes: in late October, the OBR calculated this would barely be met, albeit by a tiny margin.

Several days later, Reeves gave a media briefing so extraordinary that it caused breakfast TV to break from its usual fare. Weeks before the actual budget, the nation was put on alert: taxes would rise, and the primary cause cited as gloomy numbers provided by the OBR, specifically its conclusion that the UK was less efficient, investing more but yielding less.

And lo! It came to pass. Despite the implications from Telegraph editorials combined with Tory broadcast rounds suggested recently, this 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 justification, because those OBR forecasts didn't compel her actions. She might have chosen different options; she might have given other reasons, including on budget day itself. Prior to the recent election, Starmer promised exactly such public influence. "The hope of democracy. The strength of the vote. The potential for national renewal."

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

She did make a choice, only not the kind Labour wishes to publicize. From April 2029 UK workers as well as businesses are set to be paying an additional £26bn a year in tax – and most of that will not go towards funding improved healthcare, new libraries, nor happier lives. Regardless of what nonsense is spouted by Nigel Farage, Badenoch and others, it isn't being lavished upon "benefits street".

Where the Money Really Goes

Instead of going on services, over 50% of this extra cash will instead provide Reeves cushion against her own budgetary constraints. About 25% is allocated to paying for the administration's policy reversals. Reviewing the watchdog's figures and giving maximum benefit of the doubt to a Labour chancellor, a mere 17% of the tax take will fund actual new spending, for example abolishing the two-child cap on child benefit. Its abolition "will cost" the Treasury a mere £2.5bn, because it was always a bit of political theatre from George Osborne. A Labour government should have abolished it in its first 100 days.

The Real Target: The Bond Markets

Conservatives, Reform and all of Blue Pravda have spent days barking about how Reeves conforms to the stereotype of Labour chancellors, taxing hard workers to fund shirkers. Labour backbenchers have been applauding her budget as balm to their social concerns, safeguarding the most vulnerable. Both sides could be 180-degrees wrong: The Chancellor's budget was primarily aimed at investment funds, speculative capital and participants within the financial markets.

Downing Street can make a strong case in its defence. The margins from the OBR were deemed insufficient to feel secure, particularly considering lenders charge the UK the greatest borrowing cost among G7 developed nations – exceeding that of France, that recently lost a prime minister, and exceeding Japan which has 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 enables the Bank of England to cut its key lending rate.

You can see why those folk with Labour badges might not frame it in such terms next time they're on the doorstep. As a consultant to Downing Street puts it, Reeves has "utilised" financial markets to act as an instrument of control against her own party and the electorate. This is why Reeves cannot resign, regardless of which promises she breaks. It is also why Labour MPs will have to knuckle down and vote to take billions off social security, just as Starmer indicated recently.

Missing Political Vision and an Unfulfilled Pledge

What's missing here is the notion of statecraft, of mobilising the finance ministry and the central bank to reach a fresh understanding with investors. Missing too is intuitive knowledge of voters,