A plan to postpone rates for those financially impacted by Covid-19 or a 50 per cent remission for the worst affected has been backed by Whanganui district councillors.

Whanganui mayor Hamish McDouall said rates were vital for funding council but it needed to be empathetic about how they were charged due to the impact the pandemic has had on the economy.

At Tuesday's council meeting chief financial officer Mike Fermor said both residential and commercial property owners had been asking for rates relief and presented possible changes to the council's rates postponement and remission policy.

The proposed relief measures will now go out for public consultation.

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The changes will offer a range of criteria by which property owners can ask to postpone their rates payments - including the quarterly payment due on May 27.

That payment would be postponed until November 27 - or another date set by council - provided the property owner has a suitable payment plan in place.

A postponement fee will be charged, to cover administration and the cost of funds.

Councillors asked what criteria council will use to decide whether postponement is justified.

It could include people losing their job due to Covid-19.

Councillor Helen Craig asked whether postponement could apply to people with more than one property, or to people with a new and promising business that has lost a lot of revenue.

Fermor said all those things would be considered and would be looked at on a case-by-case basis.

"This policy does provide flexibility."

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The postponement could go on for longer, with 2020-2021 rates able to be postponed until June 30 next year.

Fermor said this would probably not be a total non-payment.

"We are hoping that we can enter into a reasonable payment programme, so at least they're paying some of the rates off prior to that June 2021 date."

If people wanted a longer postponement they would have to make a separate application.

For people in even more hardship, who have "exhausted all other means of financial assistance", remission of up to 50 per cent of rates will be possible.

Councillor Kate Joblin said the policy was "a good, solid, thoughtful piece of work".

Councillors voted to put the policy out for public consultation, with Rob Vinsen abstaining because he owns a commercial property.

Consultation will run from June 3-24, and Fermor hopes to have the policy in place by mid-July.

Covid19.govt.nz: The Government's official Covid-19 advisory website