Thousands of hard-up Lambeth Council tenants face a 17.5 percent hike in their rents next year as they are forced to pay for their town hall’s mistakes.

On average tenants will have to pay an additional £620 a year - £12 a week - in part to pay for a projected overspend by the council’s housing department of up to £15m.

The increase is set to come on top of a 5 percent rise in service payments for services such as estate management, even though many services have been slashed as the council tries to plug its spending black hole.

Tenants face a further 5 percent increase in charges for communal hot water and heating that went up by 65 percent in November.

The council argue that its rents are among the lowest in London and by increasing them, additional income can be invested in enhancing service provision.

But critics argue it is financial mismanagement that has led to such a drastic increase - the maximum that the council can impose.

Lambeth Tenants’ Council chair Rosario Mundae says the “appalling” increases would mean poor workers would be better off unemployed.

The Lib Dem opposition’s housing spokesman, Councillor Jeremy Clyne, said the increases were “a crushing blow to some of the most vulnerable and hard-pressed families in Lambeth” and the direct result of incompetence and mismanagement. But Coun Lib Peck, cabinet member for housing, said the previous Lib Dem administration left the housing budgets in a complete mess and Labour were showing the leadership to repair the damage already done.

She added: “This rent increase will bring stability and allow us to make homes better, warmer and safer for local people as well as help guarantee more than £200m of new investment which the Lib Dems spurned.”

The decision on rent levels would take place early in the new year following discussion by the housing scrutiny committee and consultation with tenants.

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