'I needed a password eight characters long, so I picked Snow White and the Seven Dwarves'

He is a vitriolic stand-up who screams at his audiences – and today he has something to shout about after winning the best joke award at the Edinburgh Comedy Festival.

Nick Helm's confrontational live show Dare To Dream, which mixes sing-along guitar songs and poetry about his romantic misadventures with self-lacerating fury, has proved one of the hits of the Edinburgh fringe.

The show is also rewarded with a nomination for the prestigious Foster's Edinburgh Comedy Award on a shortlist which includes the political stand-up Josie Long and Irish comedian Andrew Maxwell, who both rewrote their shows to include material about the riots.

The winner will be announced on Saturday but Helm is already celebrating victory in the best gag of the fringe contest. After hours of deliberation in a contest run by the digital television channel Dave, more than 3,000 comedy fans decided the best joke at the festival was: "I needed a password eight characters long so I picked Snow White and the Seven Dwarves."

Helm said: "I knew my joke was the funniest joke of all the other jokes in 2011. Thank you to Dave and all the people that voted for proving me right."

There was despair however for veteran magician Paul Daniels, who won the wooden spoon for the worst joke of the festival: "I said to a fella: 'Is there a B&Q in Henley?' He said: 'No, there's an H, an E, an N, an L and a Y.'"

The contenders for the Comedy Award – a springboard for previous winners including Steve Coogan and Al Murray – reflect a resurgence in political stand-up.

In her show, The Future Is Another Place, Josie Long attacks the Coalition's cuts and reflects on her participation in the UK Uncut protests. Maxwell tackles Scottish and Irish sectarianism, Afghanistan, Libya and the Catholic church in The Lights Are On. There is a nomination for Sam Simmons, an Australian described as the "maestro of suburban absurdism" for his surrealist routines. Adam Riches, who, like Helm, browbeats audience members into participation, is recognised along with Chris Ramsey, an observational comedian tipped to follow Russell Howard to television success.

The nominee list was delayed because judges were split over the shortlist for the Foster's Newcomer Award. It includes a show from the Free Fringe, Lady Cariad's Characters, in which Cariad Lloyd plays several characters, from a cult member to a seven-year-old stand-up comedian named Andrew.

Nica Burns, producer of the awards, said 2011 was an "exceptional year for newcomers" and the panel was "spoilt for choice". She said: "This inspired the longest debate in the history of the Newcomer Award, and a second vote. Result: an unprecedented shortlist of eight, all of whom the panel feels should be encouraged, as they clearly have a brilliant future in comedy."

The awards have run since 1981. They offer a £10,000 prize. But much greater riches can be earned from the mainstream exposure the winner receives.