Spending on Victorian jails has hit a record high under the Napthine government's tough on crime agenda, with the state's spiralling prisoner population increasing by almost 12 per cent in the last three years. The Productivity Commission's latest report on government services, released on Wednesday, reveals that spending on Victorian prisons increased to $625 million in 2012-13. This compares to a total net operating expenditure and capital costs of $517 million in 2008/9. During this time, the number of Victorians behind bars has increased from a daily average of 4,299 to 5,120 inmates. In the past three years the daily average prison population has increased by 534 inmates. Corrections Ministers Edward O'Donohue said the figures showed the Coalition government was managing the corrections system effectively, and pointed out that Victoria had the highest percentage of eligible prisoners that were employed. He said the cost of running the state's corrections system was the lowest in the country at $112.67 per head of population per year, which was $26 less than the national average. “While the prison population has grown, Victoria is investing in the staff, infrastructure and services needed to support a secure and orderly system – both now and into the future,” he said. “The Victorian Coalition Government recognises the need to keep pace with a growing prisoner population and is delivering the largest prison expansion programs in the state's history.” Since 2011 the Coalition government has delivered an extra 791 prison beds with another 2500 in the pipeline, Mr O'Donohue said. Victoria's recidivism rate has also grown, with the number of released prisoners who returned to prison under sentence within two years growing from 35.1 per cent to 36.8 per cent in 2012-13. Jesuit Social Services chief executive Julie Edwards said the government should invest in providing alternative to jail, and addressing the disadvantage that led to crime. "Prisons increases are being driven by sentencing reforms that purport to make the community safer, but the evidence shows that prison exacerbates many of the problems that lead people to offend in the first place."