Northern Ireland Secretary Shaun Woodward said he had agreed to a request from Stormont ministers for a delay to 2011 as an exceptional but justified step.
New local government boundaries are being introduced in 2009 and the number of councils slashed from 26 to 11.
Mr Woodward said 'I am committed to doing everything within my power to facilitate local politicians in local government to work together for the people of Northern Ireland.'
Paisley confident of economy
First Minister Ian Paisley said last night Northern Ireland could regain its place as an economic powerhouse.
Mr Paisley was speaking at the Confederation of British Industry's annual dinner in Belfast.
He said the devolved Stormont Executive had laid the foundations for a strong economy and he would leave knowing Northern Ireland was no longer at the crossroads.
Mr Paisley is standing down from office after next month's investment conference aimed at US business leaders.
