Incorrect, loitering is not a crime in England or Wales. The Vagrancy Acts of 1825 and 1898 which made loitering a crime were repealed by a different law on Sexual Assault in 2003.
This gentleman had a right to be in a public place for his own purposes. He is not accused of committing a crime and the fact that other people may not like his presence is not his problem. The policeman was wrong and had no authority to arrest him.