A 5.67 per cent rates rise will be part of the 2023/24 annual plan presented to the Invercargill City Council (ICC) on Tuesday (27 Jun).

The annual plan outlines what the council will spend on projects and day-to-day services over the next financial year and how these will be financed.

Mayor Nobby Clark said that council had kept the rising cost of living at “front of mind” ahead of the Annual Plan presentation.

“The entire country is experiencing rising costs of living, and that goes for the Council as an organisation too,” Clark said.

“We’ve taken a carefully managed approach to budget in order to achieve this 5.67 per cent increase.”

Council Acting Group Manager Finance and Assurance Patricia Christie said Council’s Long term Plan 2021 had predicted a rates increase of 4 per cent, which was adjusted to 5.05 per cent in 2022/2023 to encompass the cost of the new museum as well as other capital projects.

"The rest of the increase was an impact of inflation, as well as minimum wage increase on operational costs and rising interest rates across the capital programme," she said.

Clark said the Annual Plan would mean the council had an unbalanced budget, which would need to be addressed as part of the Long-term Plan.

The community were consulted on the Long-term Plan in 2021, which included a forecast rates increase, and were consulted again on changes and specific projects including the museum, which impacted on proposed rates, as part of the 2022/23 Annual Plan.

Variations to the Long-term Plan did not require consultation this year, Christie said.