News of the restrictions came as council leaders gave evidence to the Nolan committee of inquiry into standards in public life.
Association of Metropolitan Authorities secretary Rodney Brooke told LGC civil servants were prevented from taking up jobs related to their responsibilities within two years of leaving office but council officers could move directly to suppliers of council services.
The expansion of compulsory competitive tendering meant this ability represented a 'major danger of corruption'.
On Tuesday, a joint council delegation, led by Association of Metropolitan Authorities chairman Sir Jeremy Beecham, argued that MPs and ministers should be governed by the same rules of conduct as councillors.
In particular, they should be banned from taking jobs related to their ministerial responsibilities for at least a year after leaving office. Councillors cannot become employees of the same council within a year of giving up their seat.
But the associations stopped short of recommending the extension of surcharging - as suggested by the Audit Commission - to cover other parts of the public sector.