OK little update.
The Mrs ended up ignoring advice and phoning "Damp Shop Direct Limited". Their reviews on checka**de looked too good to be true to me, very sceptical.
The guy (Paul) came, looked at the wall - no obvious cause and its clearly been drying out for ages, suspects it was either caused by gutter leak (or roof leak that happened a while ago).
The mould in the dining room (not mentioned here) is almost certainly caused by the decking/joist being too close to the house and water not draining properly
There was an issue in the downstairs bathroom - on wall of (drying) damp. Straight leak.
Charge for service: £0. Not anything for him to do (plumber/plasterer required) so didn't sell us any of his services.
Can't recommend this guy enough.
Its a big relief.
Thanks again for the advice, sorry it wasn't followed. Got lucky with who we called in I think