Clearly if the work has to be done, it has to be paid for, and if it costs the council X to do it, they can charge the client X, get X from Gordon Brown or put up the rates by the amount required to recoup X.
In this case I think many people's complaint is that ODPM suggested that the council wouldn't charge the client directly, presumably assuming that council's would absorb the cost and no one would notice (although presumably govt will be soon making huge savings by shutting down the fire stations and hospitals that used to be used for the victims of all those pre part P DIY electrical disasters, so it should work out OK in the end) .
Andy