Council adopts budget with lower-than-consulted rates increase
Published on 03 June 2026
Palmerston North residents and businesses will see a lower rates increase than originally proposed, after Council today adopted its budget for the coming year with a total rates increase of 3.9%. The final increase is down from the 4.9% consulted on earlier this year and well below the 8.5% projected in the Long-term Plan.
Mayor Grant Smith said the final budget reflects Council's commitment to balancing affordability with continued investment in the infrastructure, services, and facilities the community relies on every day.
"After hearing from our community during consultation in March and April, we challenged ourselves to find additional savings and reduce the impact on households and businesses. I'm pleased we've been able to bring the overall rates increase down to 3.9% while continuing to deliver the essential services and infrastructure Palmerston North needs."
We’ve reduced spending in areas such as consultancy, overhead support areas and international relations to help keep costs down. We’ve also had another look at some of our revenue assumptions and our projected insurance costs now that we have some more up-to-date information.
Mayor Smith said community feedback played a significant role in shaping the final outcome.
"Our residents told us clearly that affordability matters, and we've listened. At the same time, people want safe roads and footpaths, reliable infrastructure, and continued support for the things that make Palmerston North a great place to live. This budget reflects those priorities and strikes a balance between managing costs today and investing in our city's future."
The adopted budget includes additional funding for road safety improvements and an extra $500,000 each year for footpath renewals, helping address community concerns about the condition of local footpaths. We’re also continuing to support initiatives which are doing great work across Palmerston North.
However, like councils across right around the country, Palmerston North continues to face rising costs, with fuel costs alone adding $1 million this year.
Mayor Smith thanked everyone who took part in the consultation process.
"We've seen great community engagement throughout this process, and I want to thank everyone who took the time to share their views. There are more important conversations ahead for our city, and I encourage people to continue being involved. Your voice genuinely makes a difference."
While the total rates increase is 3.9%, individual rates bills may be higher or lower, as this is the final year of the three-year transition to a greater portion of rates being based on a property’s capital value.
The new rating year starts on 1 July, and rates invoices will be sent out at the beginning of August.