The City of Stirling is upset the State Government has reneged on its decision to move the Department of Commerce to Stirling.
Stirling mayor Giovanni Italiano said he was "terribly disappointed" the Government had decided not to shift the department to Stirling as part of a bigger plan to move public servants to the suburbs.
Opposition Leader Mark McGowan said there was no mention of office relocations in the State Budget. "This broken promise is a massive blow for the City of Stirling, which would have enjoyed a major local economic boost and a more vibrant civic hub," he said.
Transport Minister Dean Nalder said the Government remained committed to finding value-for-money office accommodation for agencies out of Perth's central business district and into the suburbs.
He said the department would move to office accommodation that was already in the Government's property portfolio - the former Office of Shared Services - in Cannington instead.
Mr Nalder said part of the Department of Transport would move to 6500sqm of new office space in Stirling this year.
"There have been significant changes in the Perth property market and the State's financial position, which has impacted on the operational requirements of Government," he said.