State Treasurer Troy Buswell has failed to protect WA households by allowing the Water Corporation to overcharge people who use credit cards to pay their bills, the Opposition claims.
Labor has put the blame on Mr Buswell after it was revealed the corporation collected hundreds of thousands of dollars more from credit card transaction fees than it cost to process the payments.
Shadow treasurer Ben Wyatt said Mr Buswell rejected a proposal to ensure the fees "must not exceed" costs when legislation was being pushed through Parliament in 2010.
"At the time, WA Labor was concerned the Barnett Government would use this (fee) an as opportunity to rip more money out of West Australians," Mr Wyatt said.
"We moved an amendment so that a credit card administration fee imposed by a statutory corporation must not exceed the actual credit card administration cost.
"Incredibly, the Barnett Government opposed this amendment."
Mr Wyatt's comments come after it emerged last week the corporation had raised $2.6 million from the fee between February 2011 and the end of last year.
But the State-owned utility incurred costs of only $2.25 million over the same period to process customers' credit card payments.
The Water Corporation attributed the "positive revenue differential" to a shortfall in the number of payments made using American Express cards, which attract a far higher cost than Visa or MasterCard.
Mr Buswell stood by the Government's policy, saying it was designed to ensure customers were not charged more than necessary.
"It is general Government policy that fees should only be charged based upon the actual costs that are incurred," Mr Buswell said.
"No doubt the minister (for Water, Bill Marmion) is working with Water Corp to address this issue."
Mr Wyatt questioned whether the fee arrangements were lawful and said if they were not, the Government "must immediately move to refund these illegal fees charged by the Water Corporation".