Camden and Westminster councils have generated £120million from parking charges, new figures have shown.

Westminster received £80million in 2011/12 - the highest of any council in the UK - and Camden was in third place with £39.3million.

According to the RAC Foundation, Westminster Council has made a £41.6million profit, after running costs and other transport projects, such as repairing potholes, are taken in to account.

In Camden, the total surplus was £25million.

Both councils cover areas of the West End.

Neighbouring boroughs Haringey and Barnet raised less income from parking operations, which include on-street parking charges, off-street parking charges and parking penalties.

But both boroughs were still among the top 20 in the country with Haringey Council receiving £14.8million and Barnet Council £14million.

Camden defended the figures and said any surplus money from parking charges goes straight back in to transport projects.

A spokesman for Westminster Council said it was looking at ways to reduce the number of fines handed out.

Cllr Daniel Astaire, Westminster Council cabinet member for business, said: “The system is already changing and councils are already looking to work with motorists to issue fewer fines and crucially increase the amount of people parking correctly.

“Parking is about traffic management, tackling congestion and trying to implement positive benefits for businesses and high streets.

“If we stay in this Jurassic Age of pure rhetoric about cash cows and money making, innovation will be stifled and we cannot engage with motorists properly in order to find the best solutions that will benefit everyone.”

Cllr Phil Jones, Camden cabinet member for sustainability, said: “Camden’s surplus is not due to hammering drivers with ever increasing fees, instead we have looked at how we can make ourselves more efficient.

“Year on year parking tickets fall strongly in Camden.

“By removing over £3million of costs from our overheads and being more cost effective we have a larger surplus that we can use to deliver real improvements for all road users.

“Every penny of surplus is used to improve roads and make them safer for road users, and for concessionary fares and the Freedom Pass, taxicards for the old and the vulnerable while also paying to transport schoolchildren from home to school.

“This isn’t profit – every penny received is re-invested into road related projects.”