The fund generates a smaller return than interest on repayments of the state's record debt. It is forecast to grow to $5.4 billion by 2032 by setting aside mineral royalties.

Chamber of Commerce and Industry WA chief economist John Nicolaou said it was a hard policy to justify given the state no longer had a AAA credit rating.

"The policy rational isn't strong," he said.

"Are we saving for a rainy day? Basically it's raining now. It's hard to justify putting money away in a future fund that can't be withdrawn for 20 years when the need is today."

The fund was the centrepiece of the Liberal government's 2012-13 budget.

It was seeded with money from the government's Royalties for Regions program – where a percentage of mineral royalties is set aside to be invested in regional communities – and it is forecast to generate hundreds of millions of dollars of annual earnings that can be accessed in just under 20 years' time.

The policy was implemented during the iron ore boom and at a time that the state's debt was forecast to peak at $23.2 billion. That position has worsened, with debt now forecast to hit $29.4 billion by 2017-18.

Standard & Poor's stripped the state of its AAA rating last year in large part due to its high debt levels and expenditure.

Moody's Investors Service downgraded Western Australia's credit rating this week and referred to the state's "deterioration in its debt metrics".

Liberal Treasurer Mike Nahan said the money would help keep the state financially secure.

"The state government has no intention in getting rid of the Western Australian Future Fund," said Dr Nahan, who took over as Treasurer in March.

Shadow treasurer Ben Wyatt said a future fund was only suitable when a government was in a strong financial position and was recording large surpluses. He said the state Liberal-styled fund was a "budget gimmick".

"The reality is that the WA future fund is a drag on resources," he said. "You get a better return from investing in productive infrastructure or retiring debt."

Jonathan Barrett is the Perth bureau chief at The Australian Financial Review

You can follow Jonathan on Twitter at @barrett_ink