Special report: Class B for Battersea

Drugs are big business in this notorious corner of south London. Downgrading cannabis didn't help – will zero tolerance do any better? Tony Thompson reports

Less than a week after a "drug exclusion zone" was introduced, it's all too easy to believe that all the dealers have fled Battersea's notorious Winstanley and York Road estates.

This south-London hotchpotch of high-rise, low-rise, flats, maisonettes and town houses – a confusing concrete warren with many dead-ends – seems almost deserted. Despite the area's reputation, most of the deals that take place in public are the result of prior arrangements, and buyers will usually make their way to a specific address in order to pick up their drugs. Dealers' mobile telephone numbers are circulated throughout the drug underworld, and arranging delivery is so straightforward it has been likened to ordering a pizza.

"You won't find many dealers out on the streets," said one shopkeeper, who asked not to be named. "They only come out when they are needed."

And, when they are needed, they operate with Thatcherite efficiency. Dealing on the estate works on a typical pyramid system. Large gangs bring in wholesale supplies to be stored in "stash houses". These are then filtered down to street level by youth gangs. Prices are on a par with the rest of the capital – an ounce of mid-quality weed sells for around £55. Crack cocaine is £10 a rock and heroin around £80 per gram. Winstanley's popularity has more to do with its location than its prices.

Dozens of CCTV cameras have been installed throughout the estate, but dealers know the blindspots and do all their dealing there. Some drugs are kept in flats and houses while others are secreted in rubbish bins, walls or bushes.

After complaints from residents, an exclusion zone was introduced to the Latchmere area, which includes both estates, and the Crown Prosecution Service has given police the power to arrest anyone found with any amount of cannabis.

The scheme represents a major policy U-turn. Cannabis was downgraded from a class B to a class C drug in January 2004 after successful trials of a "softly, softly" approach to the drug in Lambeth, also in south London.

Arguing that valuable police resources were being wasted on prosecuting those caught with the drug, area commander Brian Paddick introduced a scheme where those found in possession of small quantities of cannabis were merely given a warning. Since reclassification there has been increasing evidence of serious health issues surrounding stronger varieties of cannabis known as skunk, which has become increasingly popular. With little fear of arrest there is also anecdotal evidence that suggests use of the drug had increased among the young.

Gordon Brown, the Prime Minister, has recently announced a review of the law which could see cannabis become a class B drug again, attracting stiffer penalties for users and dealers alike.

Under the scheme there will be no more warnings to those caught with cannabis in the Latchmere area. Those without previous convictions who admit possession will receive cautions; all others caught with cannabis will be charged and have to appear in court.

Although the scheme has met with approval on the Winstanley Estate, not all residents think it will tackle the problem. "I don't think zero tolerance will make any difference," said the shopkeeper, whose business sits in the heart of one of the estate's most notorious areas. "All the dealers out there, they can get you whatever you want. Weed, blow, rock. It's all the same to them. The idea that they might stop dealing because they might get arrested for cannabis is nonsense because most of them are dealing crack cocaine too."

The Winstanley Estate gave birth to So Solid Crew, the rap collective known as much for members' links to gun crime as their musical talents. It is also the place to find a newly opened restaurant by Dragons' Den star Levi Roots, creator of Reggae Reggae sauce. But the area's real claim to fame involves its long history as a place to buy drugs.

Drugs are a problem throughout the capital but various factors combine to make Winstanley particularly problematic. The estate sits by Clapham Junction station, the busiest in Europe, with more than 2,000 trains each day. Police have evidence that many users go by rail to the estate to buy drugs. Some of those arrested have come from as far away as Surrey or Essex.

Also, Winstanley's residents include many problem drug users. In the past these users were targeted by dealers who would take over their property to use as a base to sell drugs. The occupants would be compensated with free drugs.

The estate is only a stone's throw from the busy high street with its glitzy vodka bars, gastropubs and boutiques. This too adds to the Winstanley's problems as many users take goods stolen from nearby shops directly to the estate to exchange for drugs.

Marlene Price, the chairwoman of Latchmere Safer Neighbourhoods Team, sums it up: "All sorts of people, many of them criminals, come because they know they can buy cannabis here. This problem has got worse over the past months because this message seems to have spread. Crime is rising on the estate as a result. It is also very unpleasant for residents who have to walk past youths smoking cannabis in communal areas."

During the crack boom of the early 1990s, the now derelict Duke of Wellington pub became the centre of the south-London trade. A series of high-profile police raids helped take out the main gangs but the area was then blighted by shootings as smaller gangs fought to take over control of the turf.

In 2001, police in Wandsworth identified a new "open drugs market" for crack cocaine operating on the Winstanley Estate, and launched Operation Oval, an undercover investigation, to combat it.

Nine main dealers were arrested, and, such was the strength of evidence against them, they all pleaded guilty in court and received prison terms of up to three years. At first the loss of key dealers led to a sharp fall in dealing and street robberies. But once those arrested returned to the streets, the problem came back with them.

In 2005, police imposed one of the first dispersal orders after residents complained of being too frightened to leave their homes at night because of intimidation from gangs. The order allowed police to move on groups of youths after 9pm and led to a significant reduction in crime, though recently the problems have started to return.

Since then the Winstanley Estate has become notorious internationally. The US Drug Enforcement Administration lists Bernard Degraft, an estate resident, as a fugitive in a case originating in Atlanta, Georgia, involving a 150-strong marijuana, cocaine and heroin smuggling ring based in the US, Canada and England.

The letters SUK can be found on walls and fences throughout the estate, the tag of a local gang known as the Stick'em Up Kidz. With dozens of users travelling to the area in search of drugs, the remote parts of the estate present rich pickings for street robbers.

Police/community relations have been improved following the introduction of Dixon of Dock Green style neighbourhood officers, but residents are still reluctant to report crime because they fear reprisals.

"It's the kind of place where you really have to mind your own business if you want to live in peace," said Matthew Finley, a labourer and long-time resident. "There are places I won't go after dark... It's just not safe."

With so many crackdowns proving ineffective in the long term, many residents are sceptical that the current proposals will be any more successful. But Marlene Price is cautiously optimistic: "I believe the introduction of zero tolerance will be a major deterrent. It is important that people know if they come here to buy or sell drugs, they will be arrested."