INDIGO Shire Council will receive an extra $434,000 to spend on infrastructure projects over the next 10 months.

The one-off payment forms part of a $300 million package announced by Prime Minister Kevin Rudd at a conference attended by Indigo Shire mayor, Vic Issell, in Canberra yesterday.

Mr Rudd said the program was aimed at building local infrastructure and to help support local economies and jobs during the global financial crisis.

Council would be required to submit proposals that meet the program’s guidelines, and could include projects such as public squares, town halls, playgrounds, parks, stadiums, walkways and bus shelters.

Cr Issell said the decision on how the money will be spent rests with the new council following local government elections this month.

"We do have a long term capital works program and it will be up to managers and councillors to look at what the current priorities are, and then make the best decision for the community," he said.

The funding was announced at the first meeting of the Australian Council of Local Government, which has forged a new partnership between federal and local governments.

Cr Issell said he was able to speak briefly to the Prime Minister, during which he lobbied for an increase in financial assistance grants from the Federal Government.

"They’re the untied grants where councils get to choose how we best spend the money," he said.

"It currently stands at .62 per cent of total taxation revenue, but local government is calling for it to be increased to one per cent.