CASTLE Point Council could face a £25,000 payout after a watchdog found it double-charged taxi drivers for criminal record checks for seven years.

Anne Seex, the Local Government Ombudsman, has ruled the authority acted wrongly by effectively charging its licensed taxi drivers twice for the checks since 2003.

Mrs Seex began investigating the case following an anonymous complaint by a cabbie, who used a made-up name, Mr Hunter.

The ombudsman has ordered the council reimburses Mr Hunter for the double charges, totalling almost £80.

The council must pay him a further £75, for the time he spent pursuing the case.

She has also ruled the council: “Takes measures to remedy the injustice caused to the other taxi drivers, who have paid a licence fee and Criminal Record Bureau fee since 1 January 2004.”

The authority, which disputed the report, said it will cost more than £25,000 to pay back the owed money.

The council claims it does not have the money to pay all the drivers back.

A council spokeswoman said: “We have received the Ombudsman’s report and now have three months to consider its content and respond.

“It would be inappropriate to make any further comment before we provide a formal response to the ombudsman.”

The problems began in 2003, when the council decided to charge taxi drivers one fee for their licence and a separate fee for criminal record checks and a badge.

In December 2003, the council’s Licensing Committee agreed an increase for licence fares.

However, the figure the increase was based on included an amount for the Criminal Record Bureau fee, which had been charged separately since July 2003.

This means that since January 2004, when the increase came into account, all licensed drivers who have paid for a criminal record check and a licence have been overcharged.

For example, in the 2009/10 financial year, Mrs Seex found the council had charged cabbies needing to renew their criminal record checks £42.20 too much.