Western Australian tourism operators which are not members of specific industry groups have been excluded from the state government's DETECT and recovery grants programs.
Warren-Blackwood MLA Terry Redman said the state government must explain to tourism operators why they are not eligible and why their staff could not access asymptomatic COVID-19 testing.
Mr Redman said too many small tourism businesses in the South West were missing out on much-needed help during the coronavirus crisis but were being denied access to assistance because of restrictive government conditions.
He said many small-to-medium sized tourism businesses dropped their membership to Australia South West and the Tourism Council WA due to financial challenges over the last couple of years.
However, most of these businesses retained membership of local tourism organisations such as Margaret River Busselton Tourism Association that provided grassroots advice and networking benefits.
"The number of tourism and accommodation businesses contacting me regarding the unfairness of not even being able to apply for a recovery grant has been simply overwhelming," Mr Redman said.
"Last month I initiated a petition in support of the many small to medium businesses that have missed out and within a few days have around 100 signatures.
"The online version has around 1600 signatures, so the extent of the issue is evident."
The state government did not comment on why tourism operators which were not members of Australia South West or Tourism WA were excluded from the DETECT program.
Tourism Minister Paul Papalia said the best thing the government could do to support tourism and small business was to reopen the economy safely and get people back to work.
"The WA Government has led the nation in our response to COVID-19, with our hard border and work to suppress community transmission allowing us to reopen businesses and the state's regions much faster and more safely than others," he said.
"The government has provided a total of $2.3 billion in stimulus and small business support to assist with the impacts of COVID-19.
"The state government has launched the $14.4 million the WA Tourism Recovery Program to assist tourism businesses to manage the impacts of the pandemic and reorganise their businesses to target the local market.
"Over 1000 businesses have applied so far, including many in the South West.
"I encourage businesses not eligible for the Tourism Recovery Fund to apply for the Tourism Business Survival Grants, for grants of $25,000-$100,000, with the program now open for applications from all tourism businesses."
Vasse MLA Libby Mettam said despite appealing to the Minister, it was disappointing that the tourism recovery fund was not expanded beyond accredited tourism members.
"The tourism sector has been one of the hardest hit by COVID restrictions with one in three regional jobs shut down and $77 million a week lost to the decline in regional tourism," she said.
"The McGowan government rescue package was available to only 1600 businesses across the state and considering there are 2,700 in the South West alone, this highlights the shortfall and urgent need to expand the grant."