PLANS to make improvements to south east England's transport network could be at risk unless the Government becomes more realistic about inflationary costs.

The South East England Regional Transport Board is warning that while building costs are rising by between five per cent and seven per cent a year, Government only allows for 2.25 per cent inflation in the annual budget it gives the board.

This, the board claims, undermines the region's ability to deliver the infrastructure that is vital to support growth and means that any increases won in the regional budget are wiped out by inflation.

As a result, even projects that have been agreed can face delays due to a lack of funding.

Councillor Nick Skellett, chairman of the transport board and member of the South East England Regional Assembly, said: "The transport board wants to ensure that the region realises its full economic potential, but that requires timely investment to keep the region moving.

"Unlocking the South East's potential is not only good for the region but good for the country as a whole.

"The Government's unrealistic approach to construction inflation is eating away at regional investment.

"Even the Government's own advisors acknowledge the nature and scale of the problem.

"It is time Government got real about transport build costs."