I think that is the clutch assembly on the contact wheel for FF and RW!
A vital part in the transport mechanism.
You will be able to fix it or get a part.
That top white plastic lock got hardened, broke off with a split crack, and fell off. That plastic ring washer lock keeps the spring in place and function as a clutch mechanism. I think the other end of this contact wheel making contact with another contact wheel, engage with the tape supply reel axle for rewind, and take up axle for FF.
Inner surface of it got a channel to keep the spring in position. You might need the exact part from another M70 deck.
Our members here might have that part. It is a friction fit part. Once you push it in place, it will seat there.
There is a felt washer inside and which gives friction to the clutch mechanism.