Capping distorted democracy, Association of Metropolitan Authorities Leader Jeremy Beecham told the committee.
It had been introduced as a temporary expedient but was now an integral part of the local government finance system at a time when many people did not see it as necessary.
But MPs argued that ending the capping regime would trigger a return to 1980s style big spending 'rogue' councils. Mr Beecham countered that rogue councils could be held to account by yearly elections.
Mr Beecham singled out the additional educational needs index, which controls the allocation of almost a fifth of education SSAs. He said it was based on questionable assumptions, such as using a pupil's ethnic origin as an indicator.