In a submission to the Outer Suburban Interface Services and Development Parliamentary Committee, Agribusiness Gippsland stated it was feasible that production from the food bowl could double if it was protected from urban growth and gained increased use of recycled water.

The committee was hearing submissions on the State Government's proposal to expand the urban growth boundary eastwards into Clyde and Devon Meadows.

Agribusiness chairman Alex Arbuthot said there was potential for increased jobs in rural areas and also in food processing in areas such as Dandenong.

"This sector employs more people than any other manufacturing industry in Victoria, and the dairy industry is the largest exporter from the Port of Melbourne."

A continued rise in the use of treated recycled water from the Eastern Treatment Plant would secure the prosperity of the dairy and agricultural industries, he said.

But urban sprawl was a large threat, robbing water and resources from farming areas adjoining the south-eastern Melbourne suburbs, particularly in Koo Wee Rup swamp and Cranbourne.

State Government spokesman Chris Owner said Melbourne was growing by 1500 people a week, and action was being taken so the city remained liveable.