Councillors on Monday approved the city's budget which included an hour of free parking any time of the day in three off-street CBD car parks, but fees will rise as a trade-off.

Cr Ben Blain said the pandemic lockdowns had left many traders and workers unable to earn their usual incomes and raising parking 43 per cent in the CBD was "totally out of touch" with expectations of small businesses owners, workers and customers.

Cr Richard Ziegeler told the council it was "on notice" that next year he was looking to incrementally improve parking fees.

"I want to ultimately see free parking for the CBD without any kind of fees. I'd be more than happy to see the end of the meters as well," he said.

Cr Debbie Arnott said there had not been any fee increase in parking since 2017 and the free one-hour of parking would apply to the Parkers, Ozone and Crammond and Dickson car parks.

One, two and four-hour zones will rise from $1.40 per hour to $2 - a rise of 43 per cent - and all-day car parking will rise from $3 a day to $4, a 33 per cent increase.

Cr Arnott said workers had access 2000 free car parks on the edges of the CBD if they were prepared to walk.

Mayor Vicki Jellie said the one-hour free parking was great compromise but "maybe it could be changed and looked at over time".

"Warrnambool doesn't have a parking problem, Warrnambool has a walking and attitude problem to all this," she said.

"We need to change our thinking and encourage our community and our employees to park a few blocks away from their workplace or the shops and take advantage of the free parking and walk.

"It's great for everyone's health and wellbeing and reducing the carbon footprint, so we all need to really think on that."

Cr Ziegeler said he argued strongly in his campaign for free parking but said he wasn't able to get it though.

However, he said he was pleased there was one-hour free parking which created a motivation for employees in the CBD to actually have to walk a bit further to work

Cr Ziegeler said workers could either park further out or pay $4 for all-day parking which he labelled "cheap".

"It's up to the employees and employers, businesses to make sure their staff don't take up the place of the shoppers who are the ones that keep their businesses alive," he said.

Cr Blain praised the CBD traders as some of the most resilient in the country who not only compete with other businesses who have free parking, but endured the major downturn caused by the renewal project only to be hit with lockdown-enforced closures.

"I take my hat off to those still operating in the CBD," he said. "It's sad to see over 30 shops that are empty now up our main street."

He said it wasn't right that staff who park in the CBD now faced paying $250 more per year to go to work.

"I've heard 'if you don't want to pay for parking, walk to the shops'. It's not council's role in my view to be dictating to customers how they go the shops to spend their money - especially with an ageing population here in Warrnambool, it isn't always possible."

He asked if raising parking 43 per cent was encouraging shoppers into the CBD or driving them away.

Cr Arnott said Warrnambool was not just about the CBD. "We have a love of our entire city. There has been a huge focus on just the CBD. I do have businesses in the CBD, but I hope I am broad-minded to think beyond just the CBD," she said.

She said the council had a lot of outlying hubs such as Allansford, Woodford, Bushfield to consider apart from just the CBD.

Cr Max Taylor said that he had campaigned on free off-street parking and while he would have like to have seen two hours of free off-street parking he was happy to settle for an hour. "It's better than nothing," he said.

Cr Taylor also said it was also better than the current parking which was free only for the first two hours of the day in the three off-street car parks. He labelled the increased fees as "astronomical".

Mayor Vicki Jellie said addressed the issue of making compromises when making decisions for the whole city.

"We have made compromise. And again when we were in our election period, a lot of us have made compromise to things that we though would happen when we've come in we've seen it might have to be different."

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