A Labour-run council is charging flat owners nearly £23,000 each for two new lifts after delaying works for six years and letting the bill more than double.
Matthew Denby, 29, is one of five leaseholders living in Normanton House – a 1930s-built council block in Lambeth, London – where the local authority still owns the freehold.
Mr Denby’s family bought the flat on the open market 10 years ago after it had changed hands under the Right to Buy scheme.
Six years ago, residents raised the alarm over broken lifts and were told by the council – which has accrued debts approaching £1bn – that repair works would cost £8,500 each.
However, after delaying the work, Lambeth – a borough with a Labour majority –last month raised the bill to £22,905. The council then gave leaseholders like Mr Denby an ultimatum – pay the entire bill now and get a 5pc “discount”, or pay an additional £365 a month over the next five years.
Monthly, including the current service charge and council tax, Mr Denby will now have to cough up nearly £700 a month to the authority.
Other leaseholders are having to pay as much as £25,000, according to the council, based on the rateable values of their properties. Across two blocks on Oaklands estate, including Normanton House, residents have spent nearly £650,000 on four new lifts.
Mr Denby said: “It feels like daylight robbery. While it does look less like you’re walking into the Tower of Terror at Disneyland, I’m being asked to pay £23,000 – for that price, you’d expect it to talk to you or to be served a drink on the way up.
“I would usually be in favour of a Labour council but everything is a shambles. We have emails dating back over six years complaining to them about the leaking roof in the hallway. When I open the front door there’s a swimming pool. It feels like they [the council] have abandoned us.”
Lambeth Homeowners Association, a campaign group made up of over 100 leaseholders, said the council has a history of granting out-of-court rebates to flat owners who challenge service charge or major works bills – but only if flat owners agree to sign a non-disclosure agreement (NDA).
A Freedom of Information request shared with The Telegraph showed that between 2019 and 2023, Lambeth has rebated £1.8m across 119 NDAs. The average rebate per leaseholder was £15,000, but the association claims some have reached £50,000.
Chairman Antony Wynn said: “The overcharging comes from a lack of proper contractor management, cost control and auditing.”
Mr Wynn claims that the council have “never pursued contractors who have been proved to have overcharged”. The Telegraph put this claim to Lambeth Council but it did not deny it.
Martin Boyd, chair of trustees at campaign group Leasehold Knowledge Partnership, said costs facing leaseholders in council blocks “can be very high” – and are often “made worse” by delays to fixing long-term problems such as roof leaks.
Mr Boyd, who also chairs LEASE, the Government’s Leasehold Advisory Service, added: “Most people would assume these extra costs would fall on the landlord, but often they are charged to the leaseholders.”
Mr Boyd said it is very important that leaseholders check their contract on service charge fees: “If it says they ‘agree’ or ‘accept’ the service charge costs, the landlord may well argue this stops them going to the tribunal at a later date to challenge the costs if they think they are unreasonably high.”
The Conservatives promised to stop the sale of new leasehold homes in 2019, but have so far failed to deliver on this pledge. Earlier this year, Labour dropped its pledge to abolish leasehold within 100 days. This week, the Liberal Democrats said they would abolish residential leasehold – but gave no timeframe.
Fourteen findings of ‘severe maladministration’ in six months
As well as the long-standing leak in his building’s roof, leaseholder Mr Denby also showed The Telegraph pictures of broken windows which Lambeth Council had re-attached with sellotape.
More recently, the estate’s bicycle lock-up was broken into after someone drove their car into it. Leaseholders such as Mr Denby have flagged this to the council, but say the locks remain unfixed.
Lambeth told The Telegraph the damaged bike store will now be removed because it doesn’t have any replacement doors.
Mr Denby said: “My heart goes out to the council tenants. At least I’m making okay money and can fix problems in the flat, like the persistent mould in the bathroom. They have no choice.”
In January, the Housing Ombudsman published a report into complaints over the quality of Lambeth Council’s housing stock. It said that in the second half of 2023 alone, it issued 59 determinations on cases and made 14 findings of “severe maladministration”.
The report told the council “too many” of its residents still received an “unacceptable service”, highlighting “how poor” many residents’ experiences had been due to the local authority not prioritising complaint handling.
“Indeed, the frustration of some residents was palpable at the public meeting the landlord hosted for the Ombudsman,” the report read.
In May, residents living in another of the local authorities’ housing estates, Tulse Hill, staged a protest outside Lambeth Town Hall in Brixton. Over 160 of them have since signed a petition calling for an independent inspection of buildings on the estate.
Parents told news outlet MyLondon that their children are having to sleep in their living rooms because the mould in their bedrooms is making them sick.
Tom Kennedy, of Tenants Advice, said his organisation has seen “numerous cases” in Lambeth where residents have used solicitors to take action against the council for outstanding repairs.
He added: “Lambeth has in the past agreed to particular time frames to complete repair works – but on many occasions has missed or completely failed to carry them out.
“This is causing both council tenants and leaseholders to live in incredibly unhealthy conditions for longer and is costing the council more money in legal costs.”
Mr Kennedy said: “Leaseholders’ bills often have no breakdown, raising uncertainty and concern among leaseholders. They often contact our service frustrated and feeling ‘fobbed off’ that they are being treated unfairly compared to council tenants in the block.”
A spokesman for Lambeth Council said under the terms of their lease agreements, leaseholders – as well as the council – are required to pay a share of the costs of any repairs.
They added: “We work hard to ensure that all the work is carried out as professionally and economically as possible. The contract to install the two new lifts at Normanton House was awarded to the bidder who submitted the lowest-priced tender.
“All leaseholders were sent a notice of the proposed work in July 2020 and then confirmation of their estimated contribution in April 2021, although the council paid the majority of the cost.
“As part of our commitment to helping residents handle the costs of this work we have offered leaseholders the option to spread their repayments over a longer period of time.”
While leaseholders were sent estimates in 2021, Mr Denby’s estimate climbed by another £1,200 after that.
Last year, Lambeth Council addressed its use of NDAs – saying there is a dispute and legal action is “likely”.
It added: “Confidentiality is one of the cornerstone principles of mediation and is a service offered nationally by both the Courts & Tribunal Services and the Council to limit the time and costs of a protracted legal dispute.
“In very specific cases, settlement agreements help the Council maintain good relationships with leaseholders, reduce the burden on the court system and avoid unnecessary costs while ensuring that we can collect any money owed.”
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