Who broke the social contract?

Politicians say the social contract is broken and point at benefit claimants. Fifty years of a shrinking wage share, zero-hours work and a jobs market that is barely hiring point somewhere else.

“The social contract has been broken.” You’ll have heard some version of it this summer. The day after Reform published its welfare plan, Matt Goodwin wrote on GB News about “the looming collapse of Britain’s social contract”. Kemi Badenoch says the Conservatives will get Britain working by rebuilding “the contract between government and citizen”. In their telling it means too many people are taking out and not putting in, and the people they point at are benefit claimants.

I agree the contract is broken. I want to argue about who broke it.

What the deal was supposed to be

The social contract, as it was sold to my generation, was simple. You work. Work pays enough to live on. If you get ill, or the work disappears, there’s a floor under you, because you paid in when you could.

Every part of that has been quietly rewritten, and not by the people at the bottom.

Fifty years of taking from one side

Prem Sikka set out the numbers in July. In 1975, workers got almost 71% of the income the economy produced. By 2025, after fifty years of growth, they got 59%. Once you take inflation out, average weekly pay is barely higher than it was in 2008.

Follow that through. More than a third of people on universal credit are in work. More than four million jobs pay less than the real living wage. Over a million people are on zero-hours contracts. And on the apps that run delivery and taxi work, pay is increasingly “dynamic”. An algorithm sets the rate job by job, so drivers and riders can’t say what they’ll earn when they head out for a shift.

The Joseph Rowntree Foundation reckons a couple with two children needs to earn £74,000 a year between them for a minimum socially acceptable standard of living. Millions of people in working households fall short of it.

That’s the working side of the contract. People are keeping it. It just doesn’t pay what it promised.

The door is closing at the same time

The advice to anyone on benefits is always the same: get a job. So look at the jobs. Indeed’s economists describe Britain as a low-hire, low-fire labour market. Employers are reluctant to take people on and reluctant to let people go. Job adverts are still almost a third below where they were before the pandemic, and vacancies are at their lowest in years. If you’re looking for your first job, or your first job after being ill, that’s the door you’re knocking on.

Richard Murphy put it in one line in July: you cannot destroy jobs and demand that more people work. I wrote about that contradiction at the time, and it hasn’t gone anywhere. Policy holds down the number of jobs while ministers demand that more people find one. The social contract talk is the same contradiction, told from the other end.

And the remedy on offer is more taking

Faced with all this, what’s proposed? Reform’s welfare plan would cut disability payments and make people who’ve been out of work for more than a year do 20 hours of unpaid community work a week to keep their benefits. Twenty hours a week, unpaid, from people the market will not hire.

Meanwhile zero-hours contracts are still defended as flexibility. The new Employment Rights Act won’t bring in the right to guaranteed hours until 2027 at the earliest, and even then zero-hours contracts will still be legal.

So the same politics that let workers’ share fall, and let employers write contracts where all the flexibility runs their way, now wants unpaid work from the people its jobs market has no room for. And it calls that restoring the contract.

What I see from the training room

I deliver workplace mental health training. The people in front of me are mostly in work, and more and more of what they carry into the room is not clinical, it’s contractual. Job insecurity. Hours that change to suit the employer. Pay that doesn’t last to the end of the month. You can teach someone to notice a colleague struggling and start the conversation, and I do. But no coping strategy touches a rent rise, and no breathing exercise fixes a contract that guarantees nothing.

Sikka calls poverty a form of social violence that exhausts people and removes hope. That’s what I see in training sessions: people in work, doing everything the contract asked of them.

A contract has two sides

The people being told they broke the social contract are the ones still keeping it. They turn up, they work, they apply for the jobs that exist, they care for each other when the system doesn’t.

The other side of the deal walked away decades ago, a percentage point at a time.

If politicians want the contract honoured, the place to start isn’t twenty unpaid hours from the poorest. It’s a wage that pays, a job you can plan a life around, and a floor that holds when your health gives way. That isn’t radical. It’s just the deal as written.

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