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After Boxer is sold to the knackers without the knowledge of the other animals, and after they realize the truth and try to rescue him, Squealer goes on the offensive, lying about Boxer's fate and claiming that he died in the hospital. He tells a false story about how he sat by Boxer's bedside:
"It was the most affecting sight I have ever seen!" said Squealer... "'Forward, comrades!' [Boxer] whispered. 'Forward in the name of the Rebellion. Long live Animal Farm! Long live Comrade Napoleon! Napoleon is always right.' Those were his very last words, comrades."
(Orwell, Animal Farm, msxnet.org)
Since there is no way to dispute this story, the animals assume that Squealer is telling the truth; after all, he has never lied to them before! Well, they have never caught him, anyway. By appealing to emotion and using a beloved friend's name to push his agenda, Squealer helps to keep the pigs in control while keeping the other animals overworked and ignorant. No one else was "there" with Boxer, and the animals fear being thought of as traitors, so the lie stands as truth.
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