Lambeth’s housing policy appears to be in crisis after documents revealed a £5m overspend on a heating project in a council estate – and some of the project’s financial records were “disposed of in an office move”.

And in a separate development, a senior manager at Lambeth Living (LL) – the council’s housing arm – was rumoured to be considering resigning. The council would not comment on the rumours.

Lambeth Council is investigating the installation and procurement of the ongoing combined heat and power (CHP) project in the Roupell Park estate in Brixton Hill.

The boiler was expected to cost £3.55m, but documents obtained by the Streatham Guardian revealed the project’s spending is already at £8.4m – despite the boiler never working.

The cost of the project so far works out as £14,762 for each of the 569 homes.

Work on the CHP system, devised to improve heating and power provision to homes in the estate, started in 2004.

A grant of £956,000 from the Energy Saving Trust was given for the project in 2003, and the council added funding of £2.6m over a period of two years, from 2003 to 2005.

Information from a council officer has shown a financial breakdown for the four phases of the CHP project.

However, details for phases one to three are not available, because “records and files were disposed of during an office move in past years”, according to a document.

The total cost of the first three phases was £5,196,061, and the cost of the last phase is currently £3,190,010, bringing the total spending of the project to £8,386,072.

A Lambeth Council spokeswoman said: “We are currently undertaking a detailed investigation into the installation and procurement of the CHP project. Our priority now is to bring this project to a speedy conclusion.”

Liberal Democrat councillor Peter Truesdale, former joint chairman of housing at Lambeth Council, said: “It’s another instance where the council is wasting people’s money.”

A stormy meeting of LL’s board was due to take place tonight.

The council said the company was under threat for under-performance and changes to funding rules.

A senior manager at Lambeth Living, director of property services David Thompson, resigned with immediate effect just before Christmas.

Lambeth Council would not say whether his resignation was linked to the investigation.

Roupell Park has been a resident management organisation for 12 years, currently funded by Lambeth Council and managed by Roupell Park residents’ management committee.

Get Tweets from tonight’s meeting by following us @streathamnews or here at