THE Ballina Byron Gateway Airport will be asked to cut expenses by almost $370,000 because of a fall in revenue.

Cr Paul Worth pointed out the issue at last week's council meeting, after it was reported in the council's financial review to June 30.

He said, "I am only reading from the report, which says: 'The airport manager has been asked to find savings of $369,000'.

"It is something that we need to keep an eye on."

The financial review states that the airport's revenue was below budget "primarily due to lower passenger numbers than forecast by Virgin".

"Operating expenses were also over budget resulting in the net surplus for the year being $219,000 less than forecast," the report states.

By the end of the 2013/14 financial year it is forecast the airport's reserve will be overdrawn by $369,000; council staff said ongoing expenditure from property reserves meant the council was less able to finance the overdraft.

"This being the case, the airport manager has been asked to review his operating and capital budgets for 2013/14 to bring the reserve back to a zero balance," the report continues.

The council's general manager, Paul Hickey, said the issue was not a major concern.

"Overall, based on the high level of turnover, we are confident that savings can be made," he said.

"Often it is just a matter of delaying the timing of capital projects."

Meanwhile the airport manager is working with Virgin to increase passengers numbers. In 2012/13 the airline filled just 68% of seats, a drop from 82% in 2008/09.

It is understood Virgin and the council are working on a lower fare structure with a view to increasing the number of filled seats to 80%.