An influential committee said road-building may not always boost the surrounding economy, while traffic reduction policies could bring benefits.
The government-appointed Standing Advisory Committee on Trunk Road Assessment (Sactra) also said all major transport schemes should be subjected to an economic impact report.
The report was welcomed by the Government as supporting the emphasis on improving public transport. It also offered some solace to Mr Prescott, who has been accused of ignoring growing public impatience with Labour's transport record.
Eileen Mackay, the committee's chairman, said: "If the circumstances are right, it should be possible to reduce the rate of traffic growth without harming the economy. We are not saying that transport schemes are bad for local economies, but merely pointing out that some schemes are good while others may not be good."
Sactra, which is made up of academics, industrialists and transport leaders, is seen as an important body that can influence government policy. A 1994 Sactra report, which suggested that building more roads led to increased congestion, resulted in the Conservative government at the time cutting back on its roads programme.
Lord Macdonald, a minister for Transport, said the Government had made "a good start" on reappraising transport investment in its White Paper, and the report had built on that.
"The report addresses a wide range of issues," he said. "We need to consider each recommendation carefully, in consultation with colleagues, and expect to provide a detailed and formal response by the end of the year."
Lynn Sloman, assistant director of the environment group Transport 2000, said: "Setting higher tests for roadbuilding should sound the death knell for dinosaur road schemes that should never have seen the light of day.
"The report should also give the Government and local councils confidence to cut traffic, knowing that it will bring both economic and environmental benefits."Reuse content