Witney's MP said the situation on the heavily congested A40 will 'get worse, much worse' after a proposed dual carriageway was cancelled.
The government has approved £126million of funding for Oxfordshire County Council's A40 improvement programme.
But the dualling of the carriageway between Witney and Eynsham, which was a major part of the scheme, cannot be delivered within the funding available.
Charlie Maynard, Lib Dem MP for Witney and West Oxfordshire, said: "The A40 situation is going to continue to get worse, much worse.
"First, as per this announcement, the bus lanes scheme is not going to be fully built out now. Secondly, the new Labour government is demanding that West Oxfordshire build 62 per cent more houses in the district than planned."
He said a solution to the problem of A40 congestion was vital to the district's future.
"The A40 is causing enormous economic harm to Witney, Carterton and West Oxfordshire as a whole," he said, adding that work must continue on developing the rail project linking Oxford, Eynsham, Witney and Carterton.
Witney Labour councillor Duncan Enright, former cabinet member for Travel and Development Strategy at Oxfordshire County Council, said he had been committed to a dual carriageway to 'include West Oxfordshire people in the benefits of growth and give access to careers in Oxford and beyond".
"I’d like to understand whether the Liberal Democrats and Greens running Oxfordshire County Council see this as still the ambition," he said.
Councillors have been looking at options to improve the single carriageway main road from Cheltenham, Gloucester and south Wales to Oxford, since 2000. Options considered included light rail, trams, bus expressway and a reopened railway.
A plan for a park and ride with improved bus lanes was settled on in 2014 by the county council's previous Conservative administration.
The project initially commenced in November 2020 but was paused in 2022 when cost escalations forced a halt.
Dan Levy, Lib Dem member for Eynsham and Oxfordshire County Council cabinet member for finance, said it would be ‘tireless’ in pursuing a dual carriageway.
He criticised the previous administration for arranging funding "from two government pots, and didn't get either pot to be indexed for inflation.
"That means that it became clear that the scheme was wildly over-ambitious.
"We have scaled the scheme to fit the money available, and to make sure that only central government money is used and no Oxfordshire council tax money.
"What we are left with will produce significant improvements for drivers, bus users and people on bikes. The upgrading of the junctions will make a big difference."
He added: "The new government has said it is committed to infrastructure investment to support growth, and the county council will be tireless in pressing for the second phase of the scheme to be funded."
But Liam Walker, member for Hanborough and Minster Lovell, and shadow cabinet member for Transport Management at Oxfordshire County Council, said: "As with everything the Lib Dems appear to touch this has all ended in a very expensive transport mess for West Oxfordshire.”
“I think it’s really disappointing that after all these years and all the hard work done with consultations and plans for the dual carriageway the Lib Dems have decided to scrap this in favour of bus lanes and cycle upgrades.
"We know they’ve never been keen on the dual carriageway as it doesn’t fit with their anti-motorist agenda," he added.
The new funding does mean the inaccessible £51m Park & Ride at Eynsham is finally to be connected to the A40.
Contingent upon planning permission, construction of a new junction could begin as early as 2026, with a two-year timeline anticipated for project completion.
Phase one, which is now funded, also includes developing dual carriageways with dedicated bus lanes, alongside upgraded pedestrian and cycling paths between Eynsham Park and Ride and Oxford.
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