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The charge represents a grave matter: that Rachel Reeves has deceived Britons, frightening them to accept massive extra taxes that would be funneled into higher welfare payments. However hyperbolic, this is not typical Westminster bickering; on this occasion, the stakes could be damaging. Just last week, detractors aimed at Reeves and Keir Starmer were labeling their budget "chaotic". Now, it's denounced as lies, and Kemi Badenoch calling for Reeves to step down.

This serious charge requires clear responses, therefore let me provide my assessment. Did the chancellor lied? On current information, apparently not. There were no major untruths. But, notwithstanding Starmer's recent comments, it doesn't follow that there is nothing to see and we can all move along. Reeves did misinform the public about the considerations informing her choices. Was this all to funnel cash towards "welfare recipients", as the Tories claim? Certainly not, and the figures prove this.

A Reputation Takes A Further Blow, Yet Truth Should Win Out

The Chancellor has taken another hit to her standing, however, if facts still have anything to do with politics, Badenoch ought to call off her lynch mob. Maybe the resignation recently of the Office for Budget Responsibility (OBR) chief, Richard Hughes, due to the leak of its internal documents will quench SW1's thirst for blood.

But the true narrative is much more unusual than the headlines suggest, extending broader and deeper beyond the political futures of Starmer and his 2024 intake. At its heart, herein lies a story concerning what degree of influence the public have in the running of the nation. This should should worry everyone.

Firstly, on to Brass Tacks

When the OBR released last Friday some of the forecasts it shared with Reeves as she wrote the red book, the surprise was instant. Not merely had the OBR not acted this way before (described as an "rare action"), its figures apparently went against Reeves's statements. Even as leaks from Westminster were about how bleak the budget would have to be, the watchdog's predictions were getting better.

Consider the government's most "iron-clad" fiscal rule, stating by 2030 day-to-day spending on hospitals, schools, and the rest would be wholly funded by taxes: at the end of October, the OBR calculated this would just about be met, albeit by a minuscule margin.

A few days later, Reeves gave a press conference so unprecedented that it caused breakfast TV to interrupt its usual fare. Weeks prior to the real budget, the nation was warned: taxes were going up, and the primary cause being gloomy numbers from the OBR, specifically its finding suggesting the UK had become less efficient, putting more in but getting less out.

And so! It happened. Despite what Telegraph editorials and Tory broadcast rounds implied recently, this is basically what transpired 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 made different options; she could have given alternative explanations, even during the statement. Prior to the recent election, Starmer pledged precisely this kind of people power. "The promise of democracy. The power of the vote. The possibility for national renewal."

A year on, yet it's a lack of agency that is evident from Reeves's pre-budget speech. The first Labour chancellor for a decade and a half casts herself to be a technocrat buffeted by forces outside her influence: "In the context of the long-term challenges on our productivity … any chancellor of any party would be standing here today, facing the decisions that I face."

She did make decisions, only not one the Labour party wishes to broadcast. From April 2029 British workers as well as businesses will be paying an additional £26bn a year in tax – but the majority of this will not go towards spent on better hospitals, public services, nor happier lives. Regardless of what bilge comes from Nigel Farage, Badenoch and their allies, it isn't getting splashed on "welfare claimants".

Where the Money Really Goes

Instead of being spent, more than 50% of this additional revenue will instead provide Reeves a buffer for her own budgetary constraints. About 25% goes on covering the administration's policy reversals. Examining the watchdog's figures and giving maximum benefit of the doubt towards a Labour chancellor, a mere 17% of the taxes will fund actual new spending, such as abolishing the limit on child benefit. Its abolition "will cost" the Treasury only £2.5bn, as it was always an act of political theatre by George Osborne. This administration could and should abolished it immediately upon taking office.

The True Audience: Financial Institutions

The Tories, Reform and all of right-wing media have been barking about the idea that Reeves fits the stereotype of Labour chancellors, taxing hard workers to fund the workshy. Party MPs are applauding her budget as balm for their social concerns, protecting the disadvantaged. Each group could be completely mistaken: The Chancellor's budget was largely aimed at asset managers, speculative capital and participants within the bond markets.

Downing Street can make a strong case for itself. The margins from the OBR were deemed too small to feel secure, particularly considering bond investors demand from the UK the greatest borrowing cost among G7 rich countries – higher than France, that recently lost a prime minister, higher than Japan which has way more debt. Combined with the measures to hold down fuel bills, prescription charges as well as train fares, Starmer together with Reeves argue their plan allows the central bank to cut its key lending rate.

It's understandable why those folk with Labour badges may choose not to couch it in such terms next time they're on #Labourdoorstep. According to one independent adviser for Downing Street says, Reeves has effectively "weaponised" the bond market to act as an instrument of discipline against Labour MPs and the voters. It's the reason Reeves cannot resign, regardless of which promises she breaks. It is also the reason Labour MPs will have to fall into line and vote that cut billions from social security, just as Starmer promised recently.

Missing Political Vision and a Broken Pledge

What is absent from this is any sense of strategic governance, of harnessing the finance ministry and the central bank to reach a fresh understanding with investors. Missing too is intuitive knowledge of voters,