The Guardian (p1) reports that the proposed payments are a prelude to offering Dame Shirley Porter, the council's former leader, up to£1m if she wins her appeal against a£27m surcharge, following a seven-year inquiry into the case.
The payments to the individuals and to a trade association which represented the officials involved are recommended in a secret report by the council. The report will be discussed at a venue to be disclosed to councillors only minutes beforehand on Wednesday.
Under the proposals, Barry Legg, the authority's Tory chief whip will be offered£165,000. The former managing director of the authority, Bill Phillips, is to be offered£101,000 and two serving councillors, Alex Segal and Miles Young, will share£80,000. Another£350,000 will be handed over to a small staff organisation which represented three Westminster officials, Graham England, Sydney Sporle and Paul Hayler.
The council has been told that it can pay the money only if the recipients are 'not in any way culpable' in the scandal. This is not borne out by either the district auditor's report or by the High Court, which heard the appeals of five people involved.
Westminster sought government permission to sanction the payments with an application to John Gummer, the former environment secretary, before the last election.
But Mr Gummer declined to intervene and left the decision to his successor, John Prescott, who refused to allow the payments.
The council has been seeking to find a way to compensate officials and councillors who spent large sums on lawyers and accountants to defend themselves in the district auditor's inquiry.
The paper says that Westminster decided to act now because it felt the issue had died down and it would avoid public scrutiny.