A spiritualist group has been given Auckland ratepayer money so it can teach people to communicate with the dead.

The Foundation of Spiritualist Mediums was given $2500 last week after an application to an Auckland City Council committee.

Foundation president Natalie Huggard said it was an essential service to Auckland and was in high demand.

"There are a lot of people who have problems communicating with the spirit world and don't know how to deal with it."

She said a lot of those people were concerned about hearing voices and went to doctors, who told them they were schizophrenic and prescribed medication.

"But most just need to understand what they are hearing and how they are hearing it." Ms Huggard said the money would be put in the foundation's trust account and would fund its application to the New Zealand Qualifications Authority for recognition as a recognised training body.

The group ran courses teaching people how to communicate with the dead and how to heal the sick and injured.

As an organisation, it suffered from scepticism because of its "metaphysical" focus and NZQA accreditation - possible because of the funding - would strengthen its credibility, Ms Huggard said.

The cash given to the group was actually reduced from the $4500 council staff recommended they be awarded.

When the community development committee met on Wednesday, councillors had some reservations and reduced the amount, said chair Dr Cathy Casey. She said there had been a thorough assessment by council staff, who judged that it met the critera for community assistance funding.

Dr Casey said the group did more than communicate with the dead: "There is spriritual communication and healing.

"We have a vibrant, interesting and colourful community in Auckland city."

Groups became eligible for funding if they were a proper community organisation, open to the public and contributed to Auckland city's community vision - in this case it was by celebrating diversity, she said.

The foundation's grant was among 20 of 300 singled out and questioned by councillors.

Dr Casey said her personal views on the foundation's beliefs and practices should not sway her decision to support grants. "Just because you don't believe doesn't mean you should deny other people the right to do so."