"Institution green" is a shade of green that was once common in hospitals. You can just pick it out in the photos. I am prepared to repaint. Maybe beige all the way through?

Yes, use them, just add some modern elements to counteract them. Walls must change, and bring in metallic, maybe bronze or brushed brass in a coffee table, it works well to make nostalgia into luxe. The curtains work ok here, just update their hanging system. If those mustard chairs are grannies, I wish I had that gran. The blue is perfect with mustard, and vibrant enough to detract and contrast the mint green carpet. I would definately select a colour in that rug, perhaps I can see a slight coral red, then I would introduce varying shadesof this diluted down into pastel tones. This will comp,ement the mint and subtly introduce more depth of colour which will overtake the institution green.
Paint your walls absolutely. Not beige. I would go with a Chocolate colour, I think the richness would work with that lounge suite and also MInt green and chocolate are friends.
Chocolate is also complementary to stones, beiges, creams and coffees, so whatever direction your kitchen eventually goes, chocolate will work. And if not, it's only paint.
To make it livable now and still have some sort of positive edge about it, I'd try risky colours and textures, ones that work but ones you probably wouldn't even think of unless you had a mint green carpet.
You could always rip up the carpet and see what lies beneath. Maybe there's timber there, or concrete. Either are a bonus.

I think brown walls might be too dark in a south facing room..........maybe a deeper (nicer shade of the institution green...like a moss? but with warm undertones, otherwise the room will feel cold/drab. not a fan of the couch......can you recover the lounge, even with removable covers?

Thank you all for these considered comments. You are all very talented and have a good eye. I was thinking removable covers or maybe give them a lift by painting the wood black enamel. As for Gran, these chairs have been in the "good room" for 70 years... Nice thought about exposing the concrete floor and maybe polishing.

...I actually quite LOVE the granny lounge colours. Why not go bold with charcoal walls, crisp offwhite trims & picture frames, then find a large graphic (black & white) floor rug. Essentially drag those lounges into 2016 & ignore the carpet. The large bold rug will distract from it anyway!

This room lends itself very well to some dramatic lighting such as an oversized floorlamp, or pendant lights with a retro edge.

Hope this helps!

Old thread!!