Parking Charges and Penalties are a separate entity. I think that Parking Charges can be used however they wish.
Penalties should only be used for Traffic Management purposes. This was also amended under The Traffic Management Act 2004 section 7 item 95 "(v) "in the case of such local authorities as may be prescribed, any other purposes for which the authority may lawfully incur expenditure;” What the highlighted term means is anyone's guess.