Councillors will next week hold a special workshop to thrash out the future of the eight-day event, which posted its biggest-ever deficit since starting 16 years ago as a mid-winter drawcard.

This year's Fun4Kids Festival attracted about 19,500 people 3000 less than the previous year and 6000 below the 2012 attendance.

Crowd figures were the lowest since 2008. The biggest slump was in local patronage.

Even the headline performers Justice Crew couldn't draw the crowds with only 60 per cent of tickets to their shows being snapped up.

Total festival ticket sales this year brought in about $380,000 compared with $506,000 in 2012.

The stark reality that Australian's best children's festival has lost its allure was revealed in a briefing paper to councillors on Monday night.

It showed total expenditure of $1.15 million and revenue of $557,000.

Summary details were revealed a day later by Cr Peter Hulin during radio and television interviews.

Yesterday he told The Standard the briefing report reaffirmed what he had warned of for six years that the festival was a drain on the city and should be scrapped. "It's dead in the water," he said.

The council has committed $400,000 a year from its budget to underwrite the event which last year was calculated to inject $1.9m into the local economy plus multiplier benefits of almost another million dollars.

However, the $193,000 over-run for the council puts serious question marks over future backing.

Mayor Michael Neoh said all options would be considered at the closed-door workshop, which would produce recommendations to take to an open council meeting. "We need to look at why people weren't attending in the numbers expected," Cr Neoh said.

"The festival still brings tourists and provides economic benefits and social capital.

"But we need to get our skates on because planning for a further festival takes months ..."

Cr Neoh said it was disappointing the briefing paper details were disclosed because councillors needed confidence they could have "frank and robust discussions" before going to an open vote.

City chief executive Bruce Anson said the workshop scheduled for Thursday next week and the subsequent open meeting would be the most serious review of the festival in its history.

This is not a straightforward decision it's quite complex," Mr Anson said. "It's about what's best for the city.

"Unlike the May races and Folk Festival where patrons keep coming back every year, with the kids' festival there is a 100 per cent audience turnover every five years."

Cr Hulin said he could not see how the festival could be revived and called for new opportunities to be pursued. "We need to see an in-depth report so we can understand every single aspect," he said.

pcollins@fairfaxmedia.com.au