Opposition Leader Mia Davies said the government had dropped the ball on releasing land and underpinning development.
"The high cost of delivering water, power, and sewerage connections is a constraint on development in regional WA," Ms Davies said in her budget reply on Wednesday.
"Our plan will allow local government authorities and the private sector to access funds to address these constraints."
Ms Davies said reducing the cost of utility connections would not only unlock the potential of commercial and industrial land but encourage the release of land for housing.
"This is a responsible, common-sense investment strategy to unlock projects that will address housing constraints and assist in supporting businesses that will diversify our state's economy," she said.
The opposition's response came after WA Premier Mark McGowan last week revealed a big budget surplus.
The state's finances for 2021/22 were forecast to finish in the black to the tune of $5.7 billion, with a $1.6 billion surplus also tipped for 2022/23.
The strong performance was driven by better-than-expected tax receipts, a lift in the iron ore price since the December mid-year budget review, and an increase in GST funds.
But Ms Davies said the surplus was actually much higher, with the government dumping funds into special purpose accounts.
She said it planned to use that cash ahead of the 2025 state election.
"The premier is hiding the fact the surplus is in fact much bigger, and that's shocking when you consider the challenges we face in the health and housing sectors," Ms Davies said.
"The premier has so far showed he is capable of banking a surplus on the back of extraordinary mineral royalties and increased GST grants, but he has failed to set the state up for the future."
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