I think the social contract has been this:
Group 1- Government allows those who are able to be enterprising and to earn as much as they can for their efforts; in return a share of the proceeds must be shared with the rest through taxes
Group 2- Government asks very little from those who are economically engaged and trying, but are not succeeding spectacularly: the UK has very progressive taxes. Our tax share from low to medium earners is very small compared to our peer countries
Group 3- Government supports those who cannot or will not be productive through a range of benefits and entitlements
There is always a push me/ pull me about how much must flow from Group 1 to Group 3 and whether Group 2 should chip in, etc. There are points of view, side arguments, justifications, different framings, etc. It’s hard to know what the balance should be or can be. The latest tax rises, only hitting Group 1 are a bit of a real life, stress test. The taxes have been loaded on, and we are seeing not just whining, but action. Jobs slashed, large companies leaving Britain, small businesses folding, private sector investment on hold, major tax payers relocating, etc. This is creating a negative spiral with market negativity and high bond costs etc.
The social contract breaks for everyone, not just Group 1 who cannot make any money, but Group 3 too because there won’t be anything to redistribute to them. Group 2 caught in the middle find themselves inna disintegrating situation where things are getting worse and it all seems hopeless.
No wonder Reform lead in the polls!