Friends in low places

Batmanghelidjh, who founded Kids Company in 1996, helps the sort of youngsters whom many council officers and members, as well as residents, would want to serve with antisocial behaviour orders. She describes the children as those most people consider "the rot" of society: pregnant teenagers thrown out of home, children of prostitutes, children whose parents are addicts or who are addicts themselves.

Now operating with a budget of £2.6m a year, the south London-based charity runs educational and recreational programmes for up to 4000 five- to 18-year-olds who have been excluded from school. The youngsters, who self-refer, get practical help, like meals, clothing and a living allowance, at a cost of £5000 a child – small beer when compared with the £56,000 annual cost of keeping someone in prison. Kids Company also runs a counselling service in schools that has won plaudits from the Department of Health.

Batmanghelidjh's role is part adminstrator, part mother-figure and part social care campaigner. Drawn to the voluntary sector by the poverty she saw around her as the child of a wealthy family in Iran – they moved to Britain during the Iranian revolution in 1979 – Batmanghelidjh neither looks nor sounds like someone in authority. An exuberant person to be swathed in flowing garments, she appears more like a bohemian artist than a welfare campaigner, and her sentences are delivered in rapid, jargon-free bursts – she prefers the word "children" to "clients".

Kids Company worker Paul Baker says: "Camila gets on brilliantly with the children. There's usually a swarm of them running towards her when she comes in."

However, like many in the charitable sector, Batmanghelidjh spends more of her time on administration than working on the front line. "I came into this job really from the perspective of working with the children and I've ended up being a full-time fundraiser. I really miss the direct work with the kids."

Kids aren't the only people Batmanghelidjh wants to work with. The prospect of registered social landlords taking a more holistic view of their tenants' welfare, considering social and community care as well as bricks and mortar, might well include teaming up with projects like Kids Company. "Can you imagine housing bodies teaming up with charities to create centres like this on inner-city estates?" she enthuses. "It would be incredible."

Around 60% of children visiting the centre are homeless – either sofa-surfing, sleeping rough or moving around in a range of temporary accommodation – so housing is a key issue. It's "the one sure way to stabilise these children", says Batmanghelidjh.

My challenge is to senior managers: they must tell the truth rather than try to deliver what the government wants to see

She questions the punitive antisocial behaviour proposals on offer, arguing instead that such behaviour should be tackled at root cause. She sees providing housing as the key to combating violence.

But her campaigning zeal has made her as many enemies as friends. She has, for example, taken Southwark council's housing department to court more than a dozen times for refusing to place youngsters in hostel accommodation. Now she is embroiled in a planning permission row with the same council over how long the charity can stay in its headquarters, seven disused railway arches in south-east London. One source at Southwark praises Batmanghelidjh's work, but admits she is "a bit of a thorn in the side".

She says her prickly relationship with councils is down to what she sees as "a major communication problem between children and housing authorities". She says: "A siege mentality can develop in officers who feel they are constantly in the front line of people's anger. A whole industry is made out of keeping people waiting." She tells of young people queuing for four hours in housing departments only to be told they need to come back with a birth certificate. They'll often feel so enraged that they give up the fight for housing. "The system needs to be simpler and the process more transparent. There's a serious flaw in social services and housing. They assume that a client can fill out forms and behave appropriately."

Batmanghelidjh's detractors would say she has a tendency to make sweeping, generalised statements and label the complex housing sector as a homogenous mass: "the system". She is fond of using the word "they" when talking about local and central government and about residents who criticise her project – she also tends to ignore the under-resourced, overworked nature of the sector and paint the situation as more black-and-white than it actually is.

But it seems she is aware of the reality. "I've met some remarkable people on the ground – but their hands are tied," she admits. "I have nothing but the utmost respect for council officers, they do the best they can." That's where the vountary sector is needed, she adds: "The importance of the voluntary sector lies in its independence. A local authority worker can't cross the line and challenge their own council, or take it to court – they'd lose their job.

"My challenge is to senior managers who know how bad the situation is, but they have outputs to meet and the reality of the situation gets lost in that. Senior managers must start to tell the truth rather than just try to deliver, on paper, what the government wants to see. The government is advised on issues such as targets by young, very bright advisers who haven't lived for half a year on £42.50 a week benefit and do not have the right to comment.

"The government measures success as a concrete outcome, so if a child gets into college or into permanent housing, you've met your target; but the truth isn't as simple for children living in the inner cities. The person can meet that target – for example, by staying in education – but then something triggers a return to their old ways. For instance, we got one teenager off drugs and into college but his dealer came out of prison, tracked him down and got him back into drugs. We did get him out, but six months later we lost him. It doesn't work every time."