Criminals could enjoy a "free for all" in 11 Cornish towns if council chiefs pull the funding plug on the live monitoring of CCTV cameras, politicians and businesses have warned.

In December Cornwall Council leaders announced the £608,000 budget for the service would be slashed to £258,000.

While it will continue to maintain the cameras as they continue to record, the budget to pay for technicians to zoom in and out as events unfold on the street will be cut.

The council had wanted town and parish councils to step-in and help foot the bill to pay for the 163 cameras to be monitored, but many say they simply lack the money to do so.

Towns affected include Camborne, Redruth, Falmouth, Hayle, Helston, Newquay, Penryn, Penzance, St Austell, St Ives and Truro.

On Monday Remploy, the company that currently monitors the system, was given notice by the council that its contract will end on April 1. From then on cameras will be fixed and unmonitored.

A technician who currently monitors the images in one of the affected towns, whowished to remain anonymous, said: "We're all devastated. Some of the guys have been here for 10 or 11 years. Crime would go through the roof here.

"It would be a free-for-all – the criminals could do what they want."

The technician said evidence for court cases would be compromised if the cameras were left unmanned.

He added: "When they're not being monitored they just face one way and are zoomed out. You'd have to be lucky to catch anything and it's unlikely it would be good enough to be used as evidence.

"They're amazing when we're in control though – you can zoom in on a tax disc from streets away."

Councillor Andy Hannan, deputy mayor of Newquay, said steps were being taken to keep CCTV monitors in the town. But he said: "Undoubtedly crime will increase without monitoring. The police are stretched to cope and with all the cuts to the force this could not have come at a worse time.

"Unlike some of the other councils Newquay and St Austell have always paid a contribution towards the CCTV systems. For both towns it costs £122,000 a year to run and we pay £35,000."

Security businesses have also expressed their anxiety about the council move and are urging leaders to rethink their decision to reduce the budget. Grant Ellis, director of Ellis Security, which installs and maintains CCTV systems, said: "With council cuts inevitable, the individual businesses in these towns will have to think about their own security implications to ensure that potentially increased crime levels do not have devastating consequences."

A spokeswoman for Cornwall Council blamed cuts in Government funding for the reduction in the budget for the CCTV system.

She said: "There are three CCTV systems in Cornwall that are owned, run and funded by Cornwall Council together with contributions from some towns. In all, 163 cameras in 11 towns are currently proactively monitored at three monitoring centres – Hayle, Truro and Newquay.

"The monitoring regime is dependent on contributions being secured from all of the 11 local councils who have Cornwall Council owned and monitored cameras in their towns. The current position is that because a number of the town councils have not been prepared, for a range of reasons, to contribute to the CCTV monitoring the current contract will cease as of the 31 March 2011.

"However, the council is organising further discussions with those town councils who wish to continue the monitoring in their own areas to investigate how best this can be achieved.

"Cornwall Council will still finance the transmission and maintenance costs for the service and the cameras will remain switched on with footage being captured for use by the police to support any criminal investigations."

Roger Gazzard, clerk at Truro City Council, said: "We are obviously worried about a possible rise in crime and so are the police.

"We will be holding a meeting in early February with local businesses to see what the impact might be of losing the monitoring and see where we go from there.

"It might be that we also end up with a monitored system during our busy times."

At the time of going to press Devon and Cornwall Police had failed to respond to a request for an interview.