Suspended City of Perth Lord Mayor Lisa Scaffidi is set to be stripped of her $60,900 annual allowance, which she has continued to be paid despite being stood down from her duties earlier this year, after new laws passed through State Parliament yesterday.

Key points: The City of Perth council was suspended in March after a period of scandal

The City of Perth council was suspended in March after a period of scandal A new law will allow individual councillors and mayors to be suspended

A new law will allow individual councillors and mayors to be suspended It will bring an end to Ms Scaffidi's allowance, which she still received on suspension

The legislation gives Local Government Minister David Templeman expanded powers to suspend or dismiss individual local government councillors without pay.

Previously, in situations where one or two councillors were found to be failing to carry out their duties, the only option the State Government had was to dismiss or suspend the entire council.

Mr Templeman told ABC Radio Perth the new legislation allowed for individual mayors or councillors to be removed, allowing the rest of the council to get on with its duties.

Local Government Minister David Templeman says it isn't always sensible or practical to suspend a full council. ( ABC News: Hugh Sando )

"At the moment the department's arms are tied and so are mine if an individual is causing issues, because you can only, really, through the current legislation, deal with the full council, and that's not sensible or practical," Mr Templeman said.

"We know that, from time to time, it will be an individual that might be causing some problems, and their behaviour or their actions might be eroding the capacity of that council to do its job."

End to pay while on suspension

Mr Templeman said the new legislation would also put an end to an anomaly which had seen some councillors continue to receive pay and allowances while suspended.

The new law would now be applied to the suspended City of Perth council.

"I think the general public were particularly concerned that someone could be suspended as a councillor but continue to be paid," he said.

"Those councillors at the City of Perth are currently suspended, this legislation has passed, they are suspended so their payments will be suspended."

The City of Perth council was suspended by the Local Government Minister earlier this year. ( ABC: Matthew Perkins )

Chair Commissioner Eric Lumsden, who has taken over the running of the City of Perth, said councillors had not been paid sitting fees since the council's suspension in March.

But he confirmed Ms Scaffidi's allowance would now cease under the new laws.

"The amended legislation will now see a halt to the current payments being made to suspended Lord Mayor Lisa Scaffidi, once the Bill gains Royal Assent," he said.

"Prior to these changes it was a requirement under the Act the Lord Mayor continue to receive an allowance during suspension. This is no longer applicable and payments will cease."

Ms Scaffidi has been contacted for comment.

Dismissal remains a last resort

In response to concerns the legislation could be used by councils for political purposes, Mr Templeman stressed that a very high benchmark would have to be met before any actions were taken.

"It's not going to allow councils or individuals to start dobbing councillors in because they don't like what they're saying at council meetings," he said.

"We've got to make sure that we continue to have robust debate, I want that to continue.

"But if someone is disrupting council meetings continuously, if they are putting at risk the safety of other members, the safety of staff, if they're doing some really serious stuff, then we've got to be able to address that behaviour and do it as early as possible."

Mr Templeman said any process would involve first looking at providing training to the individual or facilitating mediation.

He said suspension or dismissal would be a last resort and decisions would be clearly documented and tabled in Parliament for transparency.

The Perth City Council was officially suspended in March after years of infighting and long-running scandal, much of it centred around Ms Scaffidi's failure to disclose gifts and travel worth tens of thousands of dollars.

There was heightened turmoil in the lead up to the suspension, with chief executive Martin Mileham and his temporary replacement, Robert Mianich, both taking extended stress leave in quick succession.

Martin Mileham was sacked by commissioners for the City of Perth on Monday. ( Supplied: City of Perth )

On Monday, commissioners for the city voted to terminate Mr Mileham's contract immediately during a special meeting.

Mr Mileham later said he was in discussion with lawyers after being sacked and said he was not told about the decision before reading it online.

Laws welcomed as a win for the community

WA Local Government Association (WALGA) president Lynne Craigie said the new legislation was a common-sense move that would save time and money.

"Sometimes it can be one person that can disrupt an entire council and, in the past, it has been that the whole council has to be stripped out," she said.

"That comes with cost to the community — you need to have an investigation, you need to re-appoint people, you need to go out to re-election.

"All of that takes money and time and the community is disrupted in that process."

Ms Craigie said removing an entire council would often also result in local governments losing valuable elected members who were serving the community well.

"Some of those people are doing a fantastic job, but one person can disrupt the whole council," she said.

"This legislation will mean less disruption for a community if this occurs.

"The good thing is council will be able to continue to run if they've got good elected members around the table."