Lambeth Council is currently owed £62.8 million in overdue invoices and debts – an increase of more than 12% on last year’s figures.
This has led to fresh concerns over how the authority manages its finances and enforces debt collection.
The figure are revealed in a report due presented to the Overview and Scrutiny Committee on 20th May, which paints a worrying picture of rising debt levels, outdated processes, and overburdened staff struggling to keep pace.
The report highlights a sharp increase in debts between 31 and 180 days overdue, as well as a troubling rise in historic debts over 360 days old — the category most difficult to recover.
Officials admitted that these long-standing debts are now mounting, raising questions about how effectively the Council is protecting public funds.
While the Council has a formal recovery process in place – starting at 31 days and escalating to legal action after 90 days for debts over £250 (excluding social care) – in practice, enforcement appears to be faltering.
Part of the problem lies in the Council’s own internal systems. Departments are frequently late in raising purchase orders, which delays invoicing and payment.
In the meantime, debt recovery staff are described as “overstretched” and lacking specialist knowledge, further compounding the issue.
The report acknowledged these shortcomings and set out a short-term improvement plan, aimed at streamlining debt collection, updating workflows, and boosting staff capacity.
In addition to its own financial pressures, the Council said it was mindful of the impact on local businesses and community organisations.
It stressed that flexible payment plans and referrals to debt charities like StepChange were available for those in difficulty.
Lambeth also employs Financial Link Workers, who use data tools to identify struggling residents and offer targeted support.
A fuller review of the Council’s invoice and debt processes is now underway, but with over £62 million still unpaid, the spotlight is firmly on whether the system can be fixed – before more money slips through the cracks.
