Napier City Council has spent $9.2 million more than its budget for the 2018/2019 year.

Despite this, the city remains in surplus, albeit a smaller one than the planned surplus.

The figures were released as part of the city's annual report.

Chief financial officer Caroline Thomson told councillors at a meeting on Thursday the extra expenditure was on water, roading, recycling and "weather-tightness".

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However, she said the expenditure was partially offset by some reduced costs at the council's Parklands residential development.

The city is running a surplus of $11.2m, which is $4.2m under the budgeted surplus.

Revenue was up $5m compared with budgeted revenue.

In the overview for the annual report Acting Mayor Faye White and chief executive Wayne Jack said the council was in good financial health.

"We have continued to work hard to set rates and debt levels that balance affordability with the need to provide for our growing community.

"We are proud Napier's average residential rates remain one of the lowest in the country."