Council's budget meeting on Tuesday night debated a recommendation the mayor receive an extra $9208 a year (to $54,072) and and councillors an increase of $1608 (to $21,888) a year.

That was 10 per cent below the maximum recommended by the Local Government Remuneration Tribunal two weeks ago.

However, Cr Kevin Duffy said they should receive the maximum which would raise the mayoral allowance to $60,080 and the councillor allowance to $24,320.

"The recommendations have been taken at full strength by other councils. Other councils have already voted on this and said 'yes we'll take the top rung," he said.

"This was an issue that was brought up at the NSW Local Government conference on a regular basis."

However, Cr Joanne McRae said it was an "awkward situation" for councillors. "My concern is that I note many in our community are going through a tough time and it's never a good look when politicians give themselves a pay rise when other members of the community are struggling," she said.

"I think it is a very awkward situation that we are approving a budget but we are also including our own pay rise."

She proposed delaying the increase. "There could be consideration that any increase we do take could come into effect from the next council. That would perhaps be a way to ensure there was more recovery."

The next council will be formed after council elections in September 2021.

Mayor Cr Reg Kidd said it was a recommendation by a tribunal.

"This shouldn't even be a debate. If you discuss it in here you are showing a conflict of interest because it is a pecuniary interest conflict that you have," he said.

Cr Jeff Whitton said council CEO David Waddell asked for the item to be removed from the budget meeting as council had just received the tribunal decision and councillors needed more information.

"This items was never, ever in any of our briefings. It is only in our papers because the tribunal had brought out the new fee structure," he said.

Councillors decided to defer making a decision on the allowances until they received more information from council staff.

Orange City Council has been reclassified by the tribunal to be a Regional Centre council, those with populations of at least 40,000 people. The new classification includes higher allowance levels than Orange's previous Regional Rural ranking.