Over 1,500 WA public servants will be relocated as part of a massive redevelopment.

The West Australian Government departments of Housing, Corrective Services, and Transport will operate from Fremantle in 2020, following the construction of 20,000 square metres of new office space.

“It's a huge boost to the working population of the City of Fremantle,” Premier Colin Barnett said.

“The construction itself means [approximately 400] jobs, but the 1,500 permanent jobs will boost the whole retail ambience, housing and development of Fremantle.”

Fremantle Mayor Brad Pettit is excited too.

“Fremantle has struggled economically for some time but we are seeing a new wave of investment,” Mr Pettit said.

“With office workers coming, we'll see a real catalyst in terms of more investment ... and actually returning Fremantle as a seven day a week economy and as Perth's second city.”

Finance Minister Sean L'Estrange said the 15-year lease on the new offices will deliver substantial savings.

“It represents $53 million of cost savings to Government, so that's a great boost for us,” he said.

It is the latest move in the Barnett Government’s push to decentralise public sector jobs currently clustered in Perth’s CBD.

The departments of Water, Economic Regulation and the Office of the Environmental Protection Authority are moving to Joondalup, while Bunbury will soon house the headquarters of the Department of Parks and Wildlife.

Housing, Corrective Services and Transport’s new hub is in the old Myer building in Fremantle’s Kings Square, where construction work is due to start next year.

Meanwhile, an alliance of six southern councils are campaigning for an outer harbour to be built at Fremantle Port.

The councils forming the Southern Corridor Alliance say building the outer harbour would generate much-needed jobs, and a region where unemployment runs close to 20 per cent.

The councils represent 411,000 voters - about one quarter of Perth's population – and say they will continue the push ahead of the next state election in March.