The council's $160 million draft operational plan and budget for 2016-17 includes rises for sewerage and water access charges similar to Australia's annual rate of inflation - below 2 per cent.

And water usage would be priced at $1.94 per kilolitre under the draft, up by 1.57 per cent from $1.91/kilolitre in 2015-2016.

Hikes of 8 per cent for water and 7 per cent for sewer services had previously been forecast for the 2016-17 year, as outlined in council documents, prompting opposition from the community and great debate among councillors and questions about gold-plated infrastructure.

On Monday as the council voted to put the draft plan on public exhibition mayor Mathew Dickerson said while he did not think the public ever welcomed an increase, they had to make sure it ran a sustainable business.

When asked if the council had bowed to public pressure in reining in the proposed increases he said they had been "listening to the community feedback".

"I wouldn't use the term bowing to public pressure but we certainly listen and that's one of the things I think has been a hallmark of this council for a number of years now," he said.

Cr Dickerson said the reality was the council faced increased costs, so it needed to "put prices up at some level".

"So we've tried to keep those prices under CPI (consumer price index, a measure of inflation) or at least around CPI," he said.

"Water's a good example - 1.57 per cent water's gone up by, obviously below CPI.

"And when we can do that, we will do that in terms of still managing a business.

"We want to make sure we don't leave council in a state that is vulnerable either from a financial perspective or maybe vulnerable from a Fit for the Future perspective.

"So we've got to make sure we've got a council that's a good sustainable business without putting increases of any level across the overall city any more than we need to."

The draft budget as presented for 2016-17 and forward budgets for the following three years were balanced, general manager Mark Riley said in a report to the council. 

The proposed revised price path would see the increase for sewerage charges limited to 1.8 per cent in 2016-17 when compared to the previous year, council technical services director Stewart McLeod said in a report to the council.

The revised path had been achieved as a result of reduced loan borrowings for the Dubbo Sewerage Treatment Plant as the tender was less than the estimated construction cost, he said.

There had also been a reduction in operational expenditure achieved across the forward project budget, he said.

For water, the director reported the lower percentage increase had been achieved "through reduction in loan borrowings due to construction projects costing less than anticipated and increased consumption by consumers".

In commending the draft budget to the community during Monday's extraordinary meeting Cr Allan Smith highlighted the lower increases.

He said council was always concerned about water pricing and there had been many debates in the past about whether they needed "gold-plated" infrastructure.

He said council staff had taken this on board.

Cr John Walkom said it was good to communicate to the community the need for increases but also that they were mindful those increases be kept to a minimum.

"I think it is a good and solid and sustainable budget for the future," Cr Walkom said.

The draft operational plan will be placed on public exhibition from Friday for a period of 28 days.