MINISTERS were under fire last night after denying that transport spending is unfairly lavished on London - instead claiming the huge extra sums are just a blip caused by the Olympics.

An MPs' investigation, which warned the spending gap between the region and the capital was "dramatic, unacceptable and getting wider", was dismissed as simply wrong by the Department of Transport (Dft).

Instead, the Dft insisted local authorities outside London had enjoyed a more than doubling of their transport budgets since the start of the decade.

Asked to explain the growing spending gap, it pointed to preparations for the 2012 Games, plus the need to rescue the failing revamp of the London Underground.

Last night, Louise Ellman, the Labour chairwoman of the Commons transport select committee, said she was "very disappointed", adding: "This response is simply not good enough.

"The government must recognise that the disparities in transport spending are too big and that this is a long-term problem. The Olympics is not just a blip - although it could make the situation even worse."

In July, the transport committee's report warned that the North-East and Yorkshire are starved of transport cash in comparison to the rest of the country - and, in particular, London and Scotland.

Comparing spending-per-head, both the North-East and Yorkshire receive 72 per cent of the UK average, a fraction of the outlay in London (195 per cent) and Scotland (162 per cent).

There is a similar gulf in capital investment, which, over the five years to 2008, rose in the North-East (by 35 per cent) and Yorkshire (37 per cent) - but by far more in London (80 per cent) and Scotland (174 per cent).

Yesterday, ministers produced figures of their own, admitting that London's share of England's transport spending had leapt from 31.1 per cent (in 2006-07) to 40.5 per cent (2007-08) and 38.1 per cent (2008-09).

However, it argued: "These figures suggest that London's share of investment remained relatively constant between 2003/4 and 2006/7, but that the Metronet failure and the 2012 Olympics have affected spend more recently."

Mrs Ellman was also angered by the Dft's rejection of her committee's plea for a £2bn transport fund - sitting unused in Whitehall - to be released immediately.

The MPs called for strict rules requiring local councils to first agree to introduce 'congestion charging' to be ripped up, because such plans were a "mess" in the teeth of fierce opposition from the public.

Meanwhile, town hall proposals to cut road congestion - including light-rail schemes - are on ice, because of a lack of funding from government.

But, in response, the Dft insisted: "A charging scheme can play an important role in maximising the effectiveness of investment in the package as a whole."