The leader of the country's local government association says there's global evidence a rates caps can have detrimental effects. 

The Government's mulling a cap as part of its wider reform to refocus local government. 

Sam Broughton —Mayor of Selwyn District Council and Local Government NZ President— says if core infrastructure like water and transport aren't included in a cap, it can lift a council's borrowing costs. 

He told Mike Hosking Australia is seeing the negatives: New South Wales has a cap, and has seen higher rates increase than those states without one. 

LISTEN ABOVE 

See omnystudio.com/listener for privacy information.