HOPES of easing congestion on East Lancashire roads have been dealt a blow by the suspension of grants for rail development.

The decision dashes plans to shift more freight by rail instead of road.

The Strategic Rail Authority is to suspend payments of grants for the development of rail freight facilities.

And the decision to cut an estimated £60million from the freight support budget from April has been condemned by the Confederation of British Industry and the Freight Transport Association.

North West Euro MP Chris Davies claims that it leaves the Government's pledge to deliver an 80 per cent increase in rail freight by 2010 in tatters.

He branded the move "short sighted" and warned it would be bad news for drivers.