Caritas Anchor House grabbed the headlines last year when, after an epic struggle with HMRC, it forced the taxman to give up its quest to force a more than £1 million bill on the VAT-exempt charity. “I didn’t think the word ‘hostel’ made our residents feel at home,” CEO Keith Fernett explains, “so I took it off the website.” HMRC officials decided, contrary to all advice up to that point, that this meant the charity had changed its purpose. A vigorous campaign ensured the decision was overturned, but the cost of the case still meant a substantial loss of income for the charity, based in Canning Town, in the London borough of Newham.

Words, it turns out, matter, and Fernett has put the dignity of the homeless guests at the core of his mission since taking the helm at Anchor House in 2004. “When I came here I could not believe how disrespectful the staff in here were to the homeless residents,” he says. “They were just numbers, they were just bodies. What I saw across the homeless sector appalled me: that it was really for the workers rather than for the homeless.

“I won the first ever UK innovation award in the homeless sector for talking to my residents – and I couldn’t work out how that was innovative. I won the second for talking to the community – again, hardly an achievement but a huge change for this sector.”

The changes in Newham are in many ways illustrative of those facing the wider metropolis. After a half-century of continuous decline, the borough’s population began to turn around in the middle of the Thatcher years.

In the decade before the Olympics, London grew by eight per cent. In the same period, Newham’s population jumped by over 26 per cent. But while many parts of the borough rank among the most deprived in Britain, Canary Wharf is nearby, and luxury flats are being built by Canning Town station. “We’ve got members of the House of Lords living across the road from here,” Fernett points out. Any available sites are snapped up by developers catering to the higher end of the spectrum. Meanwhile, the middle are feeling increasingly squeezed, putting downward pressure on the already hard-pressed, lowest-earning end of the spectrum.

Fernett says the situation has “changed radically” in recent years. “We’ve got grandmothers with 23 grandkids at the moment where the landlord wanted to increase the rent by £50 a week. Even when there is affordable housing the government now defines ‘affordable’ as 80 per cent of the market rate. That’s not affordable for people who work in a shop or people who clean the streets or who’re on the minimum wage.”

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