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UPDATE 2-British government drops road traffic target

(New story after Darling statement to parliament)

By Mike Peacock

LONDON, Dec 17 (Reuters) - Britain abandoned on Tuesday its target for cutting congestion on the roads as its transport strategy plunged further into disarray.

Last week, Transport Secretary Alistair Darling pledged to widen crowded trunk roads -- part of a road-building drive on a scale not seen for years as progress on public transport has proved elusive.

A day later, the Strategic Rail Authority said 33.5 billion pounds ($53 billion) allocated to the rail network in the government's 10-year transport plan was already running short and that major expansion projects may be shelved.

Now, Darling has dropped another central plank of that plan -- a pledge to cut road congestion over the decade.

"The forecasts made two years ago almost certainly underestimated the future levels of congestion we are faced with," he told parliament.

The new goal is to "stem" congestion growth on the roads.

Darling blamed a strong economy, with more people going to and from work, even though the government has consistently forecast strong growth.

Prime Minister Tony Blair took power in 1997 declaring he would curb car use by radically improving public transport.

Five years on roads are as congested as ever, train crashes have cost lives and plans to part-privatise London's crumbling underground rail network remain in turmoil.

Blair's deputy, John Prescott, famously said in 1997 he would have failed if over five years more people were not using public transport and far fewer car journeys were being made.

But Prescott had to wait three years until he was allowed to launch the government's 10-year blueprint which pledged more than 180 billion pounds for transport, much of it going to rail.

Liberal Democrat transport spokesman said the government had totally failed to deliver an integrated transport system. "The Transport Secretary has simply given up on public transport," he told parliament.

The government has also set a goal of increasing the number of rail passengers by 50 percent by 2010. Darling would not be drawn but admitted there was no easy route to improvements.

"There are no quick fixes or easy solutions," he said. "Sustained investment is needed year-on-year and over many decades."

Britain's main employers group, the Confederation of British Industry (CBI), called for the government to pump in more funds.

It estimates that the cost of its transport plan has risen from 180 billion to 195 billion pounds, the bulk of which is desperately needed by the railways.

"Business wants the government's strategy to work -- tearing it apart helps no one," CBI Director General Digby Jones said. "It would be a tragedy to squander this once in a lifetime opportunity to cure Britain's transport headache."