"I'm not suggesting New Zealand troops will be engaged in fire fights,but we want to be sure that if we do send someone to a dangerous place the security arrangements round them are adequate.
"We are committing the trainers, but the trainers, if we send them, will need some protection. So obviously we'll take great care to examine the rules that will be associated with their presence there."
New Zealand already has troops training for any deployment and a team of military in Iraq scoping out what role New Zealand could play and assessing factors such as safety.
Prime Minister John Key announced earlier this year that he was considering deploying troops to help train Iraqi forces but has repeatedly said it would not commit to any combat role. He has also said any contribution would be contingent on an invite from Iraq.
US President Barack Obama this week said he intended to seek permission from Congress for a three-year authorisation to step up efforts in Iraq, including deploying some special forces on the ground. The US has been undertaking air strikes since last August but has not deploy combat troops.
Mr McCully said New Zealand would make its own decisions and repeated Mr Key's assurance it would only commit to training roles 'behind the wire.' Asked about the three-year time frame President Obama had mentioned, Mr McCully said the Prime Minister had made it clear he was not interested in a long-term arrangement. Three years was "longish."
However, Labour's defence spokesman Phil Goff was sceptical about whether Obama's move would result in deeper involvement by New Zealand. He said the Government was softening up New Zealand for a greater role and predicted Mr Key would agree to consider it if there was a US request for combat involvement.
Mr McCully said he would raise the issue of corruption in the Iraqi Army - on the factors Labour have put forward as an argument against any involvement. "Those were perfectly reasonable questions given the history and we will ask those questions."
However, he said the Government had changed and a constructive approach with the new regime was needed.