Bermondsey, in south-east London, was once affectionately known as Biscuit Town. Home to some of the largest biscuit factories in the country, it provided employment to generations of local families.

Now it's a very different story. The biscuit factories have closed, and many of their former employees are unemployed. The only businesses that come into Bermondsey now are the large property developers buying up old factories and turning them into gated residences for well-paid workers at nearby Canary Wharf.

But a group of former employees of the Peek Freen biscuit factory, one of the last to close its doors, in 1989, have reunited to give Biscuit Town a new lease of life. They were brought together by artist Paula Roush, who has won Arts Council funding to launch SOS:UK, a community project that explores the local heritage of deprived communities.

Roush invited ex-workers back to Peek Freen and has run a series of events celebrating the history of Biscuit Town. This weekend, the factory is hosting a mock emergency food distribution.

Hazel Robinson, who worked at Peek Freen until it closed, says that community regeneration projects are the only weapons that can counter the growing sense of alienation felt by Bermondsey residents. "You get the feeling that the people in charge just don't want us round here any more," she says. "We can't get housing, we can't find schools for our kids, and there's no work. We're all expected to move out to Lewisham or Camberwell, but our families have lived here for years, so we need to find a way to make people feel like they still belong here."

Their first step has been to create a new biscuit for Bermondsey. A plain shortbread biscuit, packaged in the style of emergency food rations, is currently being distributed. The former Peek Freen workers have linked up with charity FairShare to give biscuits to local disadvantaged families and homeless people.

"We've all been there," says 82-year-old Ruth Jenkinson. "We know what it's like not to have two pennies to rub together, so we're showing that Bermondsey can still give something back."

The ex-workers are setting up a cooperative to sell and market the biscuits. They are also applying for Local Heritage Initiative funding to set up an office in the old Peek Freen factory, which is fast being converted into trendy commercial units.

Due to health and safety regulations, the biscuits have to be produced by a professional biscuit company. The cooperative hopes to find a way around the regulations so they can start making the biscuits themselves. "We all know how to make a decent biscuit," says Jenkinson. "So it's a shame to waste good talent."