The fabric in seat belts doesn't really break down, but was does happen is that all the dirt and body oils that the belt is subjected to over time has the fabric clogging up and becoming rather stiff and it it is this factor that has the belts not retracting like they did when they were new.
So what I do is remove the whole assembly out of the car and pull the belt out to it's limit and clamp the belt to stop it retracting. I then drop the belt only in to nice hot soapy water to soak for a little while (10 mins). From there I use a good nail brush and velvet soap and scrub in the longitudinal direction of the webbing from end to end on both sides thoroughly and then inspect. Sometimes the high traffic section of the belt will require going over again and again until perfectly clean. After that make sure that the belt is rinsed thoroughly and then I'll run the belt webbing tightly through a soft towel to remove excess water.
After that I'll hang it out on the clothes line to dry completely. You'll find that the belt will be all nice and soft again and retract like it did when it was new once refitted to the vehicle. Belts only need replacing if frayed (due to defect notices)or being used by an occupant in a serious collision, but at that point the vehicle is written off anyway and that's how Insurance Companies view seat belts.
