Thousands of leaseholders across Lambeth are to receive huge bills for £5 million of work carried out on their estates as the country goes into recession and economic decline.

Demands for five-figure sums will be sent to 3,500 leaseholders in the coming fortnight for works such as roof and windows replacements carried out as long as eight years ago.  In almost all cases, the cash demands from Labour Lambeth are expected to be disputed because of the poor quality of the work and its exorbitant cost.

The council has admitted leaseholders were not billed before because of its housing department’s “inconsistent practices” and misplaced files.  This gross incompetence means leaseholders face a lottery over who has to pay as the struggling council tries to balance its books after it racked up huge overspends over the past 12 months.

While the 3,500 will have to find huge lump sums to foot the bills, a further 2,000 will have their bills reduced or cancelled because the council does not have the information required to issue the demands.

Council officers have had to write off up to £4million worth of works because they cannot process them, admitting that thousands of other leaseholders will have to “cope with a large debt in a difficult financial climate”.  An official report warns the council will take legal action against those who do not hand over the cash.

Conservative councillors have slammed the move, with Cllr Irene Kimm saying: “This could not have come at a worst time for leaseholders, who are going to face huge bills because of the council’s incompetence.

“In many of these cases, the quality of the works carried out is poor and the cost to the leaseholders is extortionate.”