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Nick WoodNick Wood is former Head of Communications for the Conservative Party and now runs Media Intelligence Partners.

David Cameron's historic pledge of a referendum on
the terms of Britain's membership of the European Union in 2017 has not paid
the political dividends he would have hoped.

The viscerally anti-EU UKIP comfortably beat the
Tories in the Eastleigh by-election and one of this weekend's polls had it
luxuriating on 17 per cent. The county council elections, where UKIP are
fielding candidates in most of the wards, are likely to end with another bloody
nose for the Prime Minister and the increasingly threadbare defence that
mid-term setbacks are inevitable.

The summer of 2014 offers the anti-Europeans an
even better opportunity. Most observers now expect Nigel Farage's choleric revolutionaries
to either top the poll or come a close second to one of the major parties.


A buoyant UKIP almost certainly means a Tory defeat
in the general election of 2015 and, by extension, a Labour or Lab-Lib
government. So how does Mr Cameron put Dad's Army back in its box?

The formation of Business for Britain is a
potential lifeline for the PM. Backed by 500 company chiefs, it represents a
serious attempt to consolidate public opinion firmly behind his vision of a
reformed EU in which competitiveness, flexibility, power to individual states,
democratic accountability and fairness for countries inside and outside the
eurozone are the watchwords.

In part it is a reaction to the long-standing
support for a big, bureaucratic EU advocated by the big, bureaucratic firms
that dominate the Confederation of British Industry and the campaign group
Business for New Europe.

But its true purposes run much deeper. Business for
Britain has a three-fold mission. First to persuade the British public that the
EU is capable of reform and to draw up a practical agenda for change that the
people can understand and support. Second, to foster a climate in which people
can see the link between reforming the EU and boosting prosperity and freedom
at home. Third to hold Mr Cameron to account when he comes back from Brussels
waving his piece of paper.

We have been here before. In 1975, the then Prime
Minister Harold Wilson conducted a renegotiation that proved purely cosmetic
and then won a referendum in which fear of the unknown – outside the reassuring
embrace of Brussels – proved a decisive factor. There can be no repeat of that
typically Wilsonian exercise in political chicanery.

But we should be wary of getting too far ahead of
the curve. The immediate priority is for the Conservatives to spell out in
clear and simple terms what they are trying to achieve with the promised renegotiation
and to secure popular support for this change agenda. They also need to show
that UKIP's dogmatic refusal to countenance EU membership on any future terms
is a counsel of despair and defeat.

The Conservatives also need to campaign on their
referendum pledge. So far it has been striking that after the PM's speech in
January, senior ministers have had remarkably little to say about their
European agenda. This relative silence can be readily interpreted as a lack of
resolve, and a signal to the public that their heart is not really in it.
Business for Britain can help shift that perception.

Of course, so much is hypothetical. Will Labour
eventually match Cameron's referendum promise? Will the PM be persuaded to put
Ed Miliband and Nick Clegg on the spot by bringing forward legislation in this
Parliament paving the way for a referendum in the next? Would Labour and the
Lib Dems actually vote down a referendum Bill even though it has the backing of
the majority of the electorate? Will Cameron win the election and therefore put
his European plan into practice? Will he keep his word?

Matthew Elliott, the chief executive of Business
for Britain, is a confirmed Eurosceptic and a formidable campaigner. At the
head of another all-party group, No2AV, he destroyed Mr Clegg's dream of
changing the voting system so that his party had an almost permanent role as
kingmaker. As the founder of The Taxpayers’ Alliance, he has done much to raise
awareness of the perils of high tax, high spend government.

A battle royal over Britain's place in Europe
cannot be dodged for ever. Eurosceptics should be encouraged that at long last
serious business people are weighing in on the right side.

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