Tower Hamlets Council made £5.8m from parking charges after spending money on improving roads last year, according to a new report.

The borough came 18th in a list compiled by the RAC Foundation of 359 local authorities who had made huge surpluses from parking operations.

In the year 2011/12, the Council had £5,769,000 left over after paying for public street and road infrastructure.

But this figure has decreased by £187,000 since 2009/10 when the Council made £5,956,000.

RAC Foundation director Professor Stephen Glaister said: “For many local authorities, parking charges are a nice little earner, especially in London.

“Not all authorities make big sums. Several run a current account deficit and indeed of those with surpluses, many will see the money vanish when capital expenditure is taken into account.

“But the bottom line is that hundreds of millions of pounds are being contributed annually to council coffers through parking charges.”

Local Government Secretary Eric Pickles said: “This profit shows why we need to review and rein in unfair town hall parking rules.

“Councils aren’t listening, and local shops and hard-working families are suffering as a result.

“The law is clear that parking is not a tax or cash cow for town hall officers.”

A Tower Hamlets Council spokesperson said fees for parking and traffic fines were statutory and “beyond our control”.

They added: “Despite being a densely populated borough within only nine square miles, our total parking fine revenue is still comparable to those of neighbouring London boroughs.

“Any surplus generated from these fees is always reinvested into transport related projects, such as improving parking provision for businesses and visitors in the borough, and boosting economic development by investing in road network management to improve timely journeys.

“In addition, Tower Hamlets is investing more than £8m to help our most vulnerable residents to travel by providing them with freedom passes, taxi card and blue badges.

“With further new regeneration developments to come, enforcing parking and traffic regulations will continue to play a key role in ensuring the safety of all road users and balancing the needs of residents, travellers and businesses in our borough.”