The Government has approved a once-off "golden handshake" for councillors with at least five years qualifying service, who decide to retire from their local authorities before the next elections in 1999.
The measure will be included in the Local Government Bill, 1998, which comes before the Dail on Tuesday. No decision has been made on how much the councillors should be paid on retirement but it is expected to be a few thousand pounds.
Meanwhile, senior sources said that councillors elected to local authorities after the next elections, in June 1999, can expect an annual salary of up to £3,000, in addition to increased expenses.
The decision to proceed with a payment is designed to encourage older local government representatives to step down to make way for younger people. There are about 1,600 local representatives across the State.
While this provision will be in place for the next local government elections, measures concerning remuneration will not introduced until some time after polling.
Local government elections have not been held for eight years and are due next year, on the same day as polling in the European Parliament elections.
Sources said it was appropriate that councillors should at some stage receive a salary, albeit a small one, given their responsibilities. "They frequently make decisions involving far larger sums of money than politicians in Leinster House vote upon," one source said. The proposals are in the context of the review of local government reforms envisaged by the Minister for the Environment, Mr Dempsey. The primary purpose of the Local Government Bill is to put in place a new funding system for local authorities. This system will replace the funding arrangements introduced by the Local Government (Financial Provisions) Act, 1997. It provides for funding to be financed from the proceeds of motor taxation and an Exchequer contribution of £270 million in 1999. The Local Government Fund is to be "ring-fenced" exclusively for local authority purposes and the Exchequer contribution is to be adjusted annually.
The Bill also provides for increases in motor taxation and modifies the requirement that professional positions in local authorities must be filled by the Local Appointments Commissioners.