The cabinet is expected to sanction a recommendation from the Taoiseach's millennium committee to make New Year's Eve 1999 a public holiday. However, it is expected to designate it, at its meeting next Wednesday, as a once-off holiday.
The British government has already decided to make the day a public holiday, so the farewell to the second millennium and welcoming of the third could be a holiday throughout Ireland.
Other EU states which are making the day a holiday are Sweden, Denmark, Germany and Portugal. Others are considering it.
Support for the proposal has come from the Minister for Labour Affairs, Mr Kitt, who has power to designate public holidays under the Organisation of Working Time Act. The Tanaiste and Minister for Enterprise, Trade and Employment, Ms Harney, has also indicated her support.
The Irish Congress of Trade Unions and the Irish Business and Employers' Confederation have been consulted. The ICTU is understood to have been significantly more enthusiastic than IBEC, whose members will have to foot most of the £10 million pay bill.