Councillors are beginning work on a new scheme for awarding council tax benefits, which could adversely affect 12,000 families.
Currently, Calderdale Council administers Council Tax Benefits on behalf of the government and has the costs reimbursed through Government subsidy.
But when the new system of Universal Credit is introduced next year, council tax benefits for people on low incomes will be replaced by a new localised support scheme.
Councillors are studying four different options for administering the scheme but the overall impact will be a 10 per cent cut, leaving aboutd £12.4 million in the pot for distribution each year.
The council has already made provision to help subsidise the scheme and cushion the impact on those worst affected.
It will put £1.6 million into the scheme in 2013/14 and £1.1 million in subsequent years, but it is estimated that at least £2 million will be needed.
Each of the schemes devised by council officers and being debated by the community services panel on Thursday affect different people in different ways and could cost some families up to £178 a year in reduced benefits.
The rules governing benefits for pensioners will be set nationally, according to community services director Robin Tuddenham. But the council will have to determine which groups of people it regards as vulnerable and the scale of benefits for non-vulnerable claimants.
“The council must write its own scheme and put in place alternative arrangements to administer it as a discount rather than as a benefit,” said Mr Tuddenham.