Britain's businesses are losing billions of pounds every year in congestion and the Highways Agency has been too slow to introduce measures to speed up traffic, a report by the Government’s spending watchdog has claimed.

According to the National Audit Office, the Highways Agency has been ‘too risk averse’ in introducing measures used successfully abroad, is too slow bringing in technology to combat congestion, has managed trials poorly and needs to be better prepared for congestion-causing events.

It claims that the focus of the Highways Agency has been on trying to build its way out of problems with costly new road schemes, rather than adopting measures such as variable speed limits, dedicated lanes, traffic lights at slip roads and hard shoulder running, which have worked successfully elsewhere.

Sir John Bourn, head of the National Audit Office (NAO), says: "Road traffic congestion on our motorways and trunk roads is an enduring problem. I welcome the Highways Agency’s efforts to attack the problem by making better use of our existing roads. In particular, it is aiming to improve roadside information to motorists and to deal more effectively with incidents and accidents.I am looking, however, for the agency to adopt a less risk averse approach.

It must not only carry out more effective trials of proposed congestion-reducing measures; but also, if the trials are successful, follow the lead of its overseas counterparts in implementing these technologies more widely on the network."

Congestion causes British business £3 billion a year. Michael Roberts, CBI director of Business Environment, says: "Road congestion is a major cost to the economy and is set to get worse in future unless we take real action now.

"The report is absolutely right to say that we need improvements coming on stream more quickly than we have seen to date.

"There also needs to be more focus on clearing accidents and incidents quickly, as these alone are responsible for a quarter of all congestion.

"But we also need to ensure the agency and the Government do not forget to press ahead with schemes that increase strategic road capacity. That means providing enough funding to the agency both to manage and to develop the network."

An NAO spokesman added: "The latest available data shows that, nationally, although congestion levels improved between 1998 and 2003, they were still worse than they were in 1995. Average traffic speeds, for example, fell by up to 6%, or 4mph between 1995 and 2003, depending on the time of day. Speeds have fallen as the volume of traffic has continued to grow – up by 14% on all roads between 1995 and 2002."