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This allegation represents a grave matter: that Rachel Reeves has lied to UK citizens, frightening them into accepting massive additional taxes that would be funneled into higher welfare payments. While hyperbolic, this is not typical Westminster bickering; on this occasion, the stakes are more serious. Just last week, critics aimed at Reeves and Keir Starmer had been labeling their budget "uncoordinated". Now, it's branded as lies, and Kemi Badenoch demanding Reeves to step down.

Such a serious accusation requires clear answers, so let me provide my assessment. Did the chancellor lied? On the available information, no. There were no major untruths. But, notwithstanding Starmer's yesterday's comments, it doesn't follow that there's nothing to see and we can all move along. The Chancellor did misinform the public about the factors shaping her decisions. Was it to funnel cash to "benefits street", as the Tories claim? No, as the numbers prove it.

A Standing Sustains Another Blow, Yet Truth Should Win Out

Reeves has sustained another blow to her reputation, however, if facts still have anything to do with politics, Badenoch ought to stand down her attack dogs. Maybe the stepping down yesterday of OBR head, Richard Hughes, due to the leak of its own documents will quench Westminster's thirst for blood.

But the true narrative is much more unusual than media reports suggest, and stretches broader and deeper than the careers of Starmer and the class of '24. Fundamentally, herein lies a story about how much say you and I have in the running of our own country. This should should worry you.

First, to the Core Details

After the OBR released recently a portion of the forecasts it shared with Reeves as she prepared the red book, the shock was immediate. Not only had the OBR never done such a thing before (described as an "unusual step"), its figures seemingly went against Reeves's statements. Even as rumors from Westminster suggested the grim nature of the budget would have to be, the watchdog's forecasts were getting better.

Consider the Treasury's most "unbreakable" fiscal rule, stating by 2030 daily spending on hospitals, schools, and other services would be wholly funded by taxes: in late October, the watchdog reckoned this would barely be met, albeit only by a minuscule margin.

Several days later, Reeves gave a media briefing so unprecedented it forced morning television to break from its usual fare. Several weeks before the real budget, the country was put on alert: taxes were going up, with the primary cause being gloomy numbers from the OBR, specifically its conclusion that the UK was less efficient, investing more but getting less out.

And so! It happened. Despite the implications from Telegraph editorials combined with Tory broadcast rounds implied recently, this is essentially what happened during the budget, that proved to be big and painful and bleak.

The Deceptive Alibi

Where Reeves misled us concerned her alibi, since these OBR forecasts didn't compel her actions. She could have chosen different options; she might have given other reasons, including on budget day itself. Prior to last year's election, Starmer promised exactly such public influence. "The promise of democracy. The strength of the vote. The potential for national renewal."

One year later, 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 to be a technocrat buffeted by factors outside her influence: "Given the circumstances of the long-term challenges with our productivity … any finance minister of any party would be in this position today, confronting the decisions that I face."

She did make a choice, just not one Labour wishes to broadcast. From April 2029 British workers as well as businesses are set to be contributing another £26bn a year in tax – and most of that will not go towards spent on improved healthcare, public services, nor happier lives. Whatever bilge is spouted by Nigel Farage, Badenoch and others, it is not being lavished upon "welfare claimants".

Where the Money Really Goes

Rather than being spent, more than 50% of the extra cash will instead give Reeves cushion against her own fiscal rules. 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, only 17% of the tax take will fund actual new spending, for example abolishing the limit on child benefit. Its abolition "costs" the Treasury a mere £2.5bn, as it had long been a bit of theatrical cruelty from George Osborne. This administration could and should have binned it in its first 100 days.

The True Audience: The Bond Markets

The Tories, Reform along with all of right-wing media have been barking about the idea that Reeves conforms to the stereotype of Labour chancellors, taxing strivers to spend on shirkers. Labour backbenchers are cheering her budget for being a relief for their social concerns, protecting the disadvantaged. Both sides could be completely mistaken: Reeves's budget was primarily targeted towards asset managers, hedge funds and the others in the bond markets.

Downing Street can make a strong case in its defence. The margins provided by the OBR were too small for comfort, particularly considering bond investors charge the UK the highest interest rate of all G7 rich countries – higher than France, which lost a prime minister, higher than Japan which has way more debt. Coupled with our measures to cap fuel bills, prescription charges and train fares, Starmer and Reeves argue this budget allows the Bank of England to cut its key lending rate.

You can see why those folk with red rosettes might not couch it this way next time they're on the doorstep. According to a consultant to Downing Street puts it, Reeves has "weaponised" financial markets to act as a tool of control against her own party and the voters. This is the reason Reeves cannot resign, no matter what promises are broken. It's why Labour MPs must knuckle down and support measures that cut billions from social security, just as Starmer indicated yesterday.

A Lack of Statecraft and an Unfulfilled Pledge

What is absent here is the notion of statecraft, of mobilising the finance ministry and the Bank to reach a new accommodation with markets. Also absent is any intuitive knowledge of voters,