A £63 million plan to create a new railway station and passenger service have been mothballed.
Medway Council is looking to establish a new station on the Hoo Peninsula which would connect it with Gravesend, but it says high inflation, increased construction costs, and pressures on public spending has forced it to "pause" the works.
Plans to reinstate the Grain branch line and build a station at Sharnal Street, High Halstow, forms part of the authority's £170 million for the peninsula.
The Housing Infrastructure Fund (HIF) will support the building of 10,600 new homes by funding infrastructure developments including new roads and green spaces.
The council says it is now looking to improve the Peninsula's bus services.
It had already attracted criticism after it was announced there would be no rail connection to the rest of the Towns via Strood, because it would be too costly and there wouldn't be enough demand for the service.
Instead, it was proposing a battery-powered service to Gravesend, which would take 14 minutes.
The council says the cost of construction materials has impacted the budget for the project, but it will be "safeguarding" the land earmarked for the new station with a view to delivering the service in the future.
Cllr Gary Etheridge (Con), chairman of the council's regeneration, culture, and environment overview and scrutiny committee, said he was "pleased" about the delay, saying he felt the whole point of the station was diminished when the proposed link to Strood was brushed off.
He said: "We're getting back into the scenario where everybody's realising quite radically that this is a car-dominated area."
Asked whether he thought residents wanted the train service, he said: "Not at all. Everything that I've been told is that residents don't want it because it gives a further excuse to build all these houses out there because they're saying the infrastructure doesn't exist."
Council leader Cllr Alan Jarrett (Con) - who is stepping down at the elections in May - said: “Like many other important HIF-funded projects across the country, we are reviewing our investment programmes with Homes England in order to remain financially prudent.
"This is consistent with the government which very recently decided to delay the delivery of the second phase of the HS2 project and Lower Thames Crossing due to inflation and the current economic climate.
“For every major project, we keep our costs under constant review, and it is evident that currently we would not be able to deliver a sustainable rail solution with the funding available.
“Our Future Hoo team is currently scoping out how an enhanced bus service would operate.
"They are in discussions with Homes England about how this would be integrated into the proposed road improvements, alongside new cycle paths and footpaths to improve active travel connections in and around the Peninsula, which supports our climate change aspirations.
“Medway Council’s and the Hoo Consortium’s commitment to delivering sustainable communities, supported by excellent infrastructure, is unwavering and we continue to develop our plans."
Strood Rural representative, Cllr Elizabeth Turpin (Con) - who previously raised concerns about the way the HIF was being funded - said she welcomed better bus services but was concerned about the road capacity and how many of the buses would be electric.
She explained: "The issue is with the design of the roads and whether they are going to be up to standard and the air pollution is something I'm concerned about, we have got problems with air pollution anyway.
"We need to make it a good enough service so that people use it because at the moment, buses are not used well but it's probably because the service isn't reliable enough or often enough.
"I think the fact that the service wasn't going into Medway was a problem. We highlighted that being stopped and residents didn't like that, and I think they just thought it was going to possibly be a white elephant.
"I would have liked to have seen it be a success.
"We need to know more detail about what's going to happen to that £170 million; what's happening to the £63 million that was going to the rail? Is it now going to get used on the rest of the project?
"If that money's going to go into the rest of the project, it could it better; we could improve the road side of things and make that more successful."
Ward councillor George Crozer (Ind) said he thought this signalled the rail project would eventually be pulled altogether.
He said: "I think they are just using the economic situation and inflation as an excuse.
"This is the start of them pulling that option. We've thought for a long time that it was never sustainable to do it that way, it was much too expensive to do it.
"It doesn't surprise me at all."
All three councillors said they were only made aware of the change in plans when the Local Democracy Reporting Service got in touch with them.
Huw Edwards, planning director, Barton Willmore Stantec, representing the Hoo Consortium, said: “As local landowners and developers we are also only too aware of how rising inflation has pushed up costs.
“Medway Council’s proposal to pause rail and find alternative sustainable transport solutions is pragmatic and understood as we progress this important infrastructure-led project ensuring that the communities on the Peninsula benefit from the environmental and transport improvements funded by Homes England.”