Waterloo councillors have reacted with dismay to the news that no funding is currently available for a permanent library, but the council insists it is committed to finding a new site.
A report presented to the North Lambeth Area Committee last week confirmed that "there is currently no funding available for the capital development of new library facilities in the Waterloo area".
"It is nothing short of a disgrace that we may soon have the dubious distinction of 'celebrating' 50 years without a permanent library in the Waterloo area," says Cllr Diana Braithwaite (Lib Dem, Bishop's ward).
"Just when we thought we were getting close, Labour has once again pulled the rug from under local people."
But Lambeth's ruling Labour group rejects Cllr Braithwaite's criticisms.
Cllr Lib Peck, cabinet member for environment and culture, told the London SE1 website: "The administration is strongly committed to finding a site for a new permanent Waterloo library, and possible heritage centre, and is exploring the partnership funding options available that will us to make this happen.
"The council is currently undertaking a library review and this will be a key priority for that review."
A possible heritage centre in Waterloo would incorporate the Lambeth Archives, currently housed at the Minet Library in Stockwell.
The present Waterloo Library and job shop in Lower Marsh opened in 2002 as an interim measure to replace the previous North Lambeth Library (itself a temporary building) which closed when the building was declared unsafe in 2001. Waterloo has lacked a permanent library since 1966.
Local groups including Waterloo Community Development Group and the Friends of Waterloo Library have long campaigned for a permanent new library for Waterloo. Two years ago WCDG carried out a detailed feasibility study.
A council report last year admitted that Waterloo currently suffers from a "poor library service" with limited opening hours.
In the meantime WCDG and the Friends group have supported a series of storytelling and craft events in the library to encourage greater use of the current facilities.
A lunchtime reading group now meets regularly (the next meeting is on 12 April)
As an incentive to join the library in Lower Marsh new members currently receive a 10 per cent discount token to be redeemed at the adjacent Crockatt and Powell bookshop.