The announcement of funding for an extra 350 beds across two prisons in South Australia has been criticised, with opponents arguing the investment will do nothing to reduce crime and should be diverted to programs that aim to reduce offending.

Ahead of Thursday's budget, the South Australian government announced Yatala Labour Prison will expand by 312 beds, taking the facility's total capacity to 1,158, whilst the nearby Adelaide Women's Prison will gain an extra 40 beds, taking its capacity to 316.

Treasurer Stephen Mullighan said $227 million had been set aside for the largest investment in the prison system in the state's history, while the ABC reported the Department for Correctional Services chief executive David Brown argued the new beds at Yatala would ease the pressure at the facility where there are currently 720 men incarcerated.

"We are committed to our goal of reducing reoffending by 20 per cent by 2026," Mr Brown said.

"For staff to be able to achieve that, or to help people in custody achieve a reduction in their risk, we need to give them good facilities."

The government said the work at Adelaide Women's Prison will begin in January 2025, with the work at Yatala slated to begin the following August.

However, the decision has been criticised as focusing heavily on incarceration and away from restorative means.

Tabitha Lean, from the National Network of Incarcerated and Formerly Incarcerated Women and Girls (National Network), said they didn't want to see any new beds built on the site of the Adelaide Women's Prison.

"Moreover, we urge the South Australian Government to divest from women's prisons and redirect these funds towards community-based support and services," the Gunditjmara woman said.

Ms Lean said the Treasurer's argument that the expansion of prison capacity would keep South Australians safe went against the National Network's belief that prisons are inherently violent places.

Fellow National Network member Debbie Kilroy said the government's investment "perpetuates a cycle of harm" whilst doing nothing to build safer and healthier communities.

"It is time for the South Australian Government to rethink its priorities and invest in solutions that support and uplift women, rather than confine, exile and punish them," Ms Kilroy said.

Data from the December quarter shows an average daily incarceration rate in SA of 211.2 per 100,000 people: a slight decrease from 12-months previous, but an increase from the September quarter.

The Aboriginal and Torres Strait Islander incarceration rate is 2,621.8 per 100,000 people, the third highest in the country — above the national average and behind only Western Australia and the Northern Territory.

Restorative justice advocacy coalition Justice Reform Initiative urged the Malinauskas government to rethink its Budget commitment, arguing it ran contrary to its commitment to reduce offending.

Executive director Mindy Sotiri said evidence showed prison expansion was harmful, expensive, and did nothing to improve community safety.

"Crime prevention and support of people at risk of imprisonment, is best carried out in the community where the drivers of crime can be addressed," Dr Sotiri said.

"Pushing more people into prison beds further entrenches cycles of reincarceration, ultimately failing to make the community safer."

She urged the government to redirect its funding towards "evidence-based solutions that actually work to reduce crime".

"This funding would be far better spent resourcing and expanding proven support services in the community, and across all points of the justice system, to reduce contact with the criminal justice system and break the cycle," Dr Sotiri said.