KERRVILLE, Texas (AP) _ A World War II veteran shot and killed a claims counselor Wednesday in an argument over benefits to which he thought he was entitled, police said.

Rufus William Smith, 63, of Fredericksburg, was ordered held on murder charges at the Kerr County Jail on $300,000 bail in the slaying of 54-year-old John Walker Pettit of the Texas Veterans Commission.

Pettit was slain in front of his wife, Linda, a clerk at the adjacent Veterans Administration Medical Center who was in her husband's office.

''There was an argument in reference to some benefits that (Smith) felt he was entitled to and he produced a weapon and shot (Pettit),'' said Detective Joe Lanning.

Other workers witnessed the shooting as well, police said. Lanning declined to describe the weapon or give the number of shots fired. He said the suspect surrendered peacefully to hospital security officers.

Hospital spokesman Bob Fair said Smith had been receiving treatment as a hospital outpatient, but he declined to elaborate on the man's background.

Pettit had worked as the veteran-affairs counselor in Kerrville since 1979, helpoing veterans track down medical and bank records and military files to assist them in filing claims, Fair said.

''John had plenty of friends out here. He was deeply involved with all veterans organizations,'' Fair said. ''He was not one of these faceless people. He would get out among the veterans groups and help them as well as he could.''