Councillor Andrew McKibbin told his fellow councillors at Tuesday night's meeting that businesses were hurting in the current climate and an increase in rates would cause hardship.

Cr Ian Doney did not support Cr McKibbin's suggestion to limit the rate rise, saying no council was withdrawing community funding, community grants or jobs.

"We are in a low level of debt and $47,000 is not at a high risk," he said.

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Mayor Kathy Sajowitz said Oberon Council has initiatives in place to assist those people in financial difficulty.

"People I speak to say everything is going up - don't take away our services," she said.

Cr McKibbin said they must be talking to different people.

The debate on rates came during discussion about approving the 2020/21 Operational Plan and Long Term Financial Plan.

Cr McKibbin's amendment that the plan be adopted and general rates and the town improvement levy be increased by 1.5pc was lost.

Instead, the plan was adopted and councillors agreed that rates for 2020/21 will increase by the rate peg (the maximum percentage amount by which a council may increase its general rateable income for the year) of 2.6pc.

All annual charges included in the rating levy have also been increased by 2.6pc.

Council's predicted income for 2020/21 is $26,065,737. Taking away expenses from continuing operations, the net deficit is -$47,267.

Projects allocated for 2020-21 in the town improvement levy are kerb and gutter ($100,000), Oberon Common ($100,000), footpaths ($200,000), yearly top soil and furniture ($40,000), beautification program ($10,000), bulky goods collection ($20,000) and Recreation Ground grandstand stage two ($27,488).

All of council's materials and contracts, such as contractors for roads and cleaning, purchase of fuel, chemicals, utilities, and materials for the maintenance of plant, buildings, cemetery, stock, parks, gardens and grounds and library, have been increased by 1.3pc.