Local councils have been left scrambling to fill black holes in their budgets after the McGowan Government slashed road maintenance funding.

The WA Local Government Association [WALGA] warned the $10-million cut in road grants could force councils to increase rates or put safety at risk by reducing maintenance.

But Transport Minister Rita Saffioti defended the cut in road grants, saying it was made necessary by a decision to block budget savings measures and the Government's already strained finances.

The reduction represents a nearly 50 per cent cut in what had been a $24-million "direct road grants" pool, primarily used for maintenance.

The Upper House of Parliament voted last month to reject a move to discontinue concessions made to local governments on motor vehicle licences, which was estimated to cost the budget $10 million.

Ms Saffioti said councils would now be expected to use the money they had been expecting to pay in motor vehicle licences to make up for the road funding rejection.

"Councils were expecting to [pay], but now will not be paying, their motor vehicle registration," Ms Saffioti said.

"Now they can use that money to fund roads. The alternate is that taxpayers have to borrow more, that was our choice."

Ms Saffioti pointed the finger at the Liberals and Nationals for backing the Upper House's disallowance motion, despite including the measure in the former Barnett government's final budget.

Fears small regional councils will suffer most

But the move caught many councils by surprise at a time when they were finalising their budgets, forcing them to either defer road maintenance or find the funding elsewhere.

Narrogin shire president Leigh Ballard said his council still had not officially been notified of the funding changes, but was forced to adjust its budget at the last minute.

Mr Ballard said the move would hit smaller, regional local governments the hardest.

"It is about $60,000 we have got to find in our budget if we are going to maintain the roads," Mr Ballard, a former WA Nationals candidate, said.

"It is a pretty big kick in the guts to regional WA."

WALGA president Lynne Craigie said the funding cut would have a big impact on local governments, which would flow onto the broader public.

"Councils will be faced with the choice of passing on the additional financial pain to their communities or deferring road maintenance works indefinitely and ultimately putting community safety at risk," Ms Craigie said.

"Cutting back on infrastructure investment will do further harm to the WA economy and will do nothing of substance to either fix the state budget or create jobs."