Bolton Council has acted 'unlawfully' by keeping hundreds of thousands of pounds which should have been refunded to the public, it has emerged today.

Council leader Cllr Nick Peel and chief executive Sue Johnson revealed that the authority has  wrongly been keeping fees paid to the planning department that should have been refunded for around 10 years.

Cllr Peel said that he was made aware of this in May this year after becoming leader of the council after it was raised by a member of the public and that he has ordered a review to take place.

He said: “We do not want to hide anything from the people of Bolton.

“If the council has been acting unlawfully, which it has, then it is up to me and Sue to put that right.”

The Bolton News: Bolton Council owes more than £100,000 in fees it should have refundedBolton Council owes more than £100,000 in fees it should have refunded (Image: Newsquest)

He added: “I want to know how it happened, why it happened, who is responsible for this.”

Council officials say they do not yet know how many people are affected or how much money is owed, but that it runs into a six-figure sum.

Planning application fees can range from just over £200 for an application to a house extension to more than £20,000 depending on the size of the application.

The relevant law came into effect in October 2013 and states that when people pay a fee to apply for planning permission then the fee should be refunded to them after 26 weeks unless a decision is made or other agreements or exemptions are in place.

But during that time Bolton Council had not been refunding the money as it should have done.

Applicants were not made aware that they could ask for refunds and had not been doing so.

They also found that when people have been applying for planning permission they have been incorrectly told by the council that the only way to do so if through the council’s online portal, for which they have to pay a fee.

People can actually apply through other means like email, which does not need them to pay fees to the council.

Cllr Peel says that the borough solicitor is aware of what has happened and is now acting as a monitoring officer “because information has come to light to say that the council hasn’t been acting in a lawful manner.”

He said: “The monitoring officer has taken third party advice which has confirmed that she is obliged to ensure we take all reasonable steps to ensure all people who are entitled to refunding are refunded.”

Cllr Peel says that the review is “only obliged to go back six years” but he will talk with other party leaders and hopes it will go back further.

He said: “My instinct is that is an indefensible position for the council only to go back six years, its morally right that we go back ten years.”

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An internal audit is now underway and will report its findings to be scrutinised by the council.

Cllr Peel admitted this had come at a hard time amid impending cuts to the authority’s budget.

He said: “This is not what we need at this hour, but in the interests of transparency this will be put forward for scrutiny.”

Ms Johnson says that she and her colleagues have raised the issue with the Local Government Association but cannot speak for other councils about whether or not they too are affected.

She also confirmed the process of refunding people has already begun.

A report will be discussed at a Bolton Council meeting next week.