The Andrews government has announced plans to build a new maximum security prison at Lara.

Corrections Minister Gayle Tierney said the new publicly-run jail would "roughly double" the size of the existing Barwon Prison, with the government negotiating with landowners adjacent to the current Barwon Prison site.

"We know that our investments in more police and tougher sentencing will result in more people spending time behind bars," she said.

Barwon Prison. (File)

"We're planning for that growth now."

Barwon Prison. (File)

But the government refused to be drawn on a timeframe for the prison, or the number of beds, saying details would be announced as part of the May state budget.

Acting Corrections Commissioner Rod Wise said the new facility would help the state's prison system keep pace with population growth.

The new publicly-run jail would "roughly double" the size of the existing Barwon Prison. (9NEWS)

"If our imprisonment rates stay exactly the same, we will need an extra 600 beds every four years", Mr Wise said.

The announcement came as a report by the Productivity Commission revealed a big drop in the number of Victorians feeling safe in their homes.

Just 79 percent of Victorians say they feel safe at home, down from 87 percent.