The city should encourage hundreds of unneeded teachers to resign by giving them "generous" payouts, Schools Chancellor Dennis Walcott said in a speech Thursday morning.

Eight hundred teachers are currently sitting in the Absent Teacher Reserve pool without jobs, costing the city $100 million a year, which Walcott said is an unacceptable waste of money.

"If you're a teacher who can't find a permanent job in our schools after a year, we will offer you a generous incentive to resign and pursue another career," Walcott said at an Association for a Better New York breakfast Thursday.

"It would reduce a significant burden on our budget, allowing us to divert millions of dollars back to schools," Walcott continued. "Every dollar we save, we can use to benefit our students, instead of wasting it on teachers who probably chose the wrong profession."

A quarter of the teachers in the reserve pool have been disciplined for breaking rules, and nearly half have not taken any steps to find a new job in the past year, Walcott said.

The Department of Education did not immediately respond to questions about how much the buyouts would cost and where the money would come from.

The United Federation of Teachers UFT president Michael Mulgrew said the DOE agreed in June that it would use the absent teacher reserve pool as substitutes in classrooms with sick or missing teachers, rather than spending more on substitutes.

In addition, Mulgrew said the city has the right to dismiss teachers who don't have tenure "virturally at will."

The union had been willing to negotiate a "voluntary severance payment" for teachers who are in the pool of teachers waiting for a classroom.

"You would have to ask the Chancellor why, if this is such a good idea, it has taken the administration ten years to implement it," the UFT said in a statement.

"While no one wants to protect teachers who are not doing the job, the more important issue is the thousands of good teachers who leave the system every year because of substandard pay, bad teaching conditions and lack of support from their superiors. That's the real problem our schools face, and I have yet to hear the Chancellor or the Mayor come up with a strategy to deal with it."