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England, as Napoleon observed, was once a nation of shopkeepers. Two centuries after the soldiers paid for by those shopkeepers trounced Bonaparte at Waterloo, David Cameron has described a more diversified economy and sought to claim it for his party. The Tories, he said yesterday, are the party of “the small businesses, the techies, the rooftilers, the retailers, the plumbers and the builders”. Mr Cameron is broadly right. Whether he can turn this to electoral advantage is one of the central questions of the next ten days.

The prime minister’s pitch to entrepreneurial Britain was remarkable for the martial fervour of its delivery and for coming so late in the campaign. As he admits in an interview in The Timestoday, the fighting tone is part of a new effort to show some of the passion his critics say he lacks. On the evidence of the past 48 hours this may be working, whether or not it translates into an advantage in the polls. As to the timing of the prime minister’s courtship of small-business owners he can at least claim he is no longer taking them for granted.

If the economy is the coalition’s strongest suit in this election, the creation of an extraordinary 2.2 million jobs by the private sector is its strongest card. Most of these jobs are in small and medium-sized businesses, not excluding the self-employed who now make up 15 per cent of the workforce. Most but not all of the owners of these businesses are Tory strivers by inclination. The impact of a letter toThe Daily Telegraph yesterday, purportedly signed by 5,000 Conservative small-business owners, was mildly diluted when it emerged that the list had been compiled by Conservative Central Office. Mr Cameron is right to say he is engaged in a “fight for the backbone of Britain”, but it is not a straight fight between small businesses and Labour. It is a fight between the Conservatives and Labour for the allegiance of a new business class.

The coalition’s record on nurturing start-ups is unquestionably strong. Its goal of registering 600,000 new businesses a year over the next five years might seem absurd but for the numbers logged in the past five: 760,000 new firms since 2010 and nearly 350,000 in 2013 alone. Creating the conditions for this boom is an achievement of which one famous shopkeeper’s daughter would have been proud, but Mr Cameron has been slow to boast of it. One reason is that self-employment has been a default option for many who now earn a living online as freelancers or in e-commerce. Made possible by technology and light-touch regulation, it can be lucrative but it is still precarious.

Another reason that championing small businesses has been considered dangerous by the risk-averse Tory campaign is that such firms live or die by labour-market flexibility — which Labour has successfully “weaponised” with its focus on zero- hours contracts. The truth behind these contracts is that they account for 2 per cent of all new jobs created during the last parliament, and that 60 per cent of employees on them like them. The equivalent figure for those on fixed or full-time contracts is 59. Zero-hours contracts are abused by a minority of unscrupulous employers but when sensibly administered can help workers as much as businesses, and Mr Cameron should say so.

Britain’s biggest small-business alliance claims to represent five million voters. Labour’s offer to them consists mainly of a pledge to cut and then freeze business rates, and to guarantee stability by ruling out a European referendum. The Conser- vatives have promised a review of business rates. However, their trump cards are flexible labour laws, including those allowing zero-hours contracts, and fines to deter frivolous employee lawsuits, the threat of which can break small businesses. A Labour-led government would put both in jeopardy and would risk putting the coalition’s job-creation miracle into reverse. Napoleon would be astonished. Voters should be alarmed.

Andy McGowan
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