COUNCILLORS in Huntingdonshire may have to decide who in the district loses out when the Government cuts back on the amount it spends on Council Tax benefit in two years’ time.

Whether or not that happens depends on which Big Beast in Whitehall wins the battle to control the benefit.

Work and Pensions Secretary Iain Duncan Smith wants to incorporate the rebate into his planned universal credit system (the DWP currently funds 98 per cent of the benefit, though it is administered by councils), but political heavyweight Local Government Secretary Eric Pickles takes the view that each council should take the decision locally.

If Mr Pickles's view prevails, it will be councils that have to decide where the 10 per cent axe falls. In Huntingdonshire's case, that amounts to £900,000 a year on the current £9million Council Tax benefit bill, plus the £300,000 annual cost of administering the scheme, according to Councillor Terry Rogers, cabinet member for finance.

He offered members a menu of possible rule changes if the decision eventually fell to them to decide who should pay the price.

Would it be, for example among a host of possibilities, income- or capital-related, determined by size of house, whether there were dependents, disabled people, war widows or war pensioners, should there be a comparison with neighbouring councils' rules, or a time-limit for claimants to find work?

How would the council handle fraud, appeals and what is euphemistically called 'over-payment', which may be the result of council error, genuine mistakes by claimants or calculated failure to disclose a change of circumstances?

"Whatever is decided will go live in April 2013," Cllr Rogers told the council last week. "Whatever policy is adopted - and a consultation will start in May this year - will impact on 9,000 benefit claimants in the district and will cost this council a considerable sum."

Cabinet member Cllr Jonathan Gray, who works in the City, said the notion of creating a local benefit scheme was barmy and would create a postcode lottery for claimants.

"It's not within our expertise to deliver something as important to the well-being of our residents."

The council's director of commerce and technology, Terry Parker, said after the meeting that, if the scheme did devolve onto councils, they would have to ensure benefits were properly incentivised, with councillors having to decide who was no longer a deserving case for the benefit.

"If the Government is determined to take 10 per cent out of the cost of the benefit, what kind of person is going to get less money?"

At present, there are 9,223 Council Tax benefit claimants in Huntingdonshire, overwhelmingly in the lowest-value bands of housing - 3,266 in Band A properties, 3,564 in Band B, 1,726 in Band C (which is average for the district), 446 in Band D (the benchmark national average), 161 in Band E, 45 in Band F, nine in Band G and none in the highest category of most expensive property, Band H.