A controversial probation shake-up has come under fresh criticism after a report revealed the bill could rise by hundreds of millions of pounds.
The government has revised up the maximum projected payments to private providers that supervise offenders living in the community in England and Wales.
An assessment from the National Audit Office (NAO) detailed how the volumes of activity community rehabilitation companies (CRCs) are paid for were well below the levels expected when the scheme was drawn up.
Earlier this year it emerged that the Ministry of Justice had adjusted contracts with the CRCs.
The NAO's report said: "Following the contract adjustments, the Ministry's maximum projected payments to CRCs for rehabilitation services increased by £278 million.
"The Ministry signed variations to the contracts on June 6 2017, which became effective for most CRCs from August 1 2017.
"The changes increased the Ministry's maximum projected payment to CRCs for fee for service over the life of the contracts by £278 million.
"Combining this with the additional payments of £42 million and £22 million gives total additional projected payments of £342 million."
The combined adjustments increase the maximum projected fee for service payments to CRCs under the contracts to £2.5 billion, according to the report.
This is below the £3.7 billion projected in 2016 and lower than the Ministry's estimates when the contracts were awarded.
Meg Hillier, chairwoman of the Commons Public Accounts Committee, said: "Hundreds of millions of pounds of additional taxpayers' money is now being directed at CRCs, but it remains to be seen if the changes are enough to fix the government's broken system, and help reduce re-offending."
Known as Transforming Rehabilitation, a partial privatisation launched in 2014 saw the creation of the National Probation Service to deal with high-risk cases, while remaining work was assigned to 21 CRCs.
The latest findings come days after the probation watchdog revealed thousands of offenders in the community are managed by a brief phone call every few weeks.
A Ministry of Justice spokesman said: "As we said in July, probation services are falling short of our vision for a high-quality system that reforms offenders and commands the confidence of courts.
"That is why we have changed CRC contracts to address the challenges CRCs are facing as a result of their financial situation, due to the reduction in the volumes of offenders referred to them.
"We are clear that CRCs must deliver a higher standard of probation services, which strictly enforces sentences, reduces reoffending and protects the public."