A $3.8 billion plan will bring almost 3,000 new prison beds into the New South Wales prison system over the next four years in a bid to deal with overcrowding, the State Government has announced.

The prison population is at a record high of 12,000 inmates, with Corrective Services have been cramming mattresses into cells to deal with the crisis.

Last month the Government scrapped a plan to reopen Parramatta jail and instead announced it would sell Long Bay jail and build a new prison at Wollondilly, on the outskirts of Sydney's south-west.

Now it has an overall plan to spend $3.8 billion over the next four years.

"The NSW budget for the next financial year will see an extra $2.2 billion in capital for our prison population and $1.6 billion recurrent to manage that," Corrections Minister David Elliott said.

Under the plan, 2,800 beds will be delivered in the next three years, including 1,700 at the new Grafton jail, hundreds more than originally anticipated. There will also be:

620 at Cessnock Correctional Centre in the Hunter Valley

620 at Cessnock Correctional Centre in the Hunter Valley 160 at South Coast Correction Centre near Nowra

160 at South Coast Correction Centre near Nowra 135 at the reopened Berrima and Wollongong correctional centres

7,000 beds under extended plan

Mr Elliot said the funding would ultimately lead to more than 7,000 new prison beds around the state, but the detail only relates to around 3,000 extra beds.

"The money also includes a development to expand another 4,200 beds that would come in over the next five years," he said.

"It's no secret that our prison population is increasing, and I want to make sure that when the courts order the incarceration of people that they are incarcerated safely, securely and we provide them with the rehabilitation services that are necessary."

A paper published by BOSCAR earlier this year said the increase in prison inmate numbers was partly because of changes to how courts dealt with suspects and offenders, and partly because of an increase in the number of people charged with serious offences.

Mr Elliott said some of the money would be spent on rehabilitation programs to "help meet the Government's commitment to reduce adult reoffending by five per cent."

Both the Opposition and the Greens have said there were no details on those programs.

Announcement follows cuts to staffing

Labor's Corrections spokesman Guy Zangari said the Government recently cut the number of educators in the state's jails.

"At the moment there are 153 Corrections educators in the system," he said.

"The Government has put on the table that instead of those there will be clerks.

"We don't know whether those teachers who'll go will be able to reapply for these new positions."

Mr Zangari said the new positions would be paid less.

"The teachers are experienced; you simply cannot put a clerk in there, someone who has a certificate IV and no real experience in dealing with behaviour modification," he said.

Greens MP David Shoebridge said today's announcement reflected years of failed policies.

"We now know what the price of Mike Baird's social failure is in terms of broken bail laws, aggressive policing, new offences and underfunded courts," he said.

"It's a $3.8 billion price tag of failure.

"That's what's going to see more and more of our citizens put in extremely expensive jails."