The council is seeking to make a policy of paying for some funeral costs for local indigenous people, flying the Aboriginal and Torres Strait Islander flags every day at the St Kilda Town Hall, and recognising "Invasion Day" – a term which some people use for Australia Day.

Cr O'Connor also said using the words "Invasion Day" was a way of reflecting Aboriginal people's languages and phrases.

The Herald Sun and MTR radio had interviewed the Emerald Hill ward councillor about the council's plans to work with Port Phillip's indigenous communities to foster reconciliation.

"The only item there that has got any likely dollar figure is the funeral assistance one. We expect it to be less than $10,000 a year," he said.

He said an example was hiring buses to take indigenous community members to last year's funeral for Aunty Maria Starcevic and singer Ruby Hunter's funeral in 2010.

"We explicitly said in that action it's about costs associated with funerals to make sure there are possibilities for the community to participate in the funeral. The request that was put in by the community was for a small fund to ensure funerals for local indigenous people can be held in dignity. In the past it's been things like buses. I think we need to work through the details."

Councillor Jane Touzeau said aspects of the plan like funeral costs and flying the Aboriginal flag were "really very modest asks".

Port Melbourne indigenous poet, radio host and activist Dennis Fisher congratulated the council on its reconciliation plan: "They do lots for us."