Gather round, comrades, for we are witnessing a scandal so brazen it makes the Expenses Duck House look like a Quaker prayer meeting. In the last 24 hours the Office for Budget Responsibility has quietly slipped out the documents that confirm what every half-sentient adult already suspected: Rachel Reeves has been lying – deliberately, repeatedly, and with the cold-eyed calculation of a City wide-boy cooking the books before a float.
Yes, that £22 billion “black hole” she brandished like Excalibur for the entire summer? Pure fiction. A mirage conjured in the Treasury’s smoke-filled rooms and obligingly leaked to friendly hacks at the FT and the BBC. The OBR’s latest release (paragraphs 4.12–4.18 if you’re feeling masochistic) makes it crystal clear: the previous government’s spending plans were already baked into the baseline, the fiscal headroom was there all along, and the terrifying shortfall existed only in the fevered imagination of a Chancellor who needed a pretext to break every promise she made in July.
This wasn’t incompetence. This was a co-ordinated deception. Treasury officials – under direct ministerial instruction – fed selective, misleading figures to the press for months. Bond traders sold gilts, mortgage rates spiked, pension funds took fright, and the pound wobbled like a drunk on a unicycle. In any other walk of life this would be called market manipulation. On Threadneedle Street they call it insider dealing and send you to Belmarsh for less. When the Chancellor of the Exchequer does it, apparently, they give you a standing ovation at the TUC conference.
Let that sink in. A Labour Chancellor – a Labour Chancellor! – weaponised fear of bankruptcy to soften up the electorate for tax rises she always intended to impose. The £40 billion raid on jobs, farms, pensions, and small businesses announced yesterday wasn’t “unavoidable”. It was premeditated. The black hole was the political equivalent of a dead cat on the table: something so shocking that nobody would dare ask why the rest of the banquet tasted of broken promises.
And the sheer brass-necked cheek of it! Standing at the dispatch box yesterday, hand on heart, Reeves still had the gall to claim she only discovered the “true state” of the books after entering office. The OBR has just handed us the receipts proving she knew – or her officials knew, which is the same thing in law – that the scare story was bollocks before the removal vans had even left Downing Street.
This is criminal. Not “ooh isn’t politics awful” criminal. Actual, prosecutable, Companies Act 2006 Section 89 “false or misleading statements inducing investment” criminal. The kind of thing that saw Asil Nadir doing bird and Robert Maxwell doing the backstroke off Tenerife. Except Maxwell never had the keys to the Treasury press office.
So what happens now? Sweet FA, of course. The Crown Prosecution Service won’t touch a sitting Chancellor with a ten-foot bargepole wrapped in parliamentary privilege. The FCA will mutter about “complex market dynamics” and look the other way. And Labour backbenchers who spent five years screaming about Tory sleaze will discover that principles are remarkably elastic when payroll vote is on the line.
But we don’t have to play along. We can remember. We can point, laugh, and never let the bastards forget that the woman currently lecturing us about “tough choices” spent the summer running the biggest con-trick in modern fiscal history.
And when your mortgage payment jumps next spring because the gilt markets were spooked by a lie, send Rachel the bill. She knows where to find the £22 billion she pretended had vanished. It was in her imagination all along.
Yours in perpetual fury,
Ken Palarse
Recommended reading :
- Liar’s Poker by Michael Lewis – still the best primer on how markets get played
- The Big Short by Michael Lewis – essential viewing for anyone who thinks governments don’t rig the game
- Bad Blood by John Carreyrou – because Theranos was amateur hour compared to this
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