Climate change should be the catalyst for a radical social re-engineering of Victoria, according to a controversial submission to a Victorian Parliamentary inquiry that has pitted the west of the state against the east.

The inquiry into Melbourne's future water needs has been told that cities in Western Victoria would become drier and government investment on jobs and infrastructure would be better spent in Gippsland.

In a twist, Bendigo Mayor David Jones said there was "a little bit of truth" in the controversial attack on his city.

Submitted by Wellington Shire Council — in eastern Victoria — the document suggested that Gippsland take over the "food-bowl responsibility" for Victoria in "all future government thinking".

"Proposals to move water from Gippsland to western areas of the state to support agricultural activity … must be reconsidered," said the submission, which was signed by Wellington chief executive Lyndon Webb.

"The encouragement of jobs and population growth to areas to the west of Melbourne, including Geelong, Ballarat and Bendigo, which are targeted to experience significant reductions in rainfall through climate change, must be challenged on the basis that these regional areas are becoming more reliant on water from Gippsland."

The comments are a reference to the increasing interconnection of water supply across the state under the Victorian Water Grid, which the Government claims will allow water to flow from "Wonthaggi to Wycheproof".

Bendigo and Ballarat already drink water from Lake Eildon via the Goulburn River and "Goldfields super-pipe".

Cr Jones said Bendigo had a robust, diverse economy that continued to warrant investment, but he added that people had to be realistic about the impact of climate change.

"There is a little bit of truth in that submission … there is some merit in the idea that some of the high water-using industries should be located where the water is," he said.

But other figures from western Victoria responded angrily to the attack from Wellington Shire, with Labor MP for Western Victoria Jaala Pulford saying investment in her electorate should continue "with gusto".

"I can confidently say that residents of Geelong and Ballarat would be outraged at the suggestion that western Victoria be left to dry out," she said.