A £4m fund to help voluntary sector organisations win public sector contracts has been scrapped two months before it was due to open.
The Mayor’s Incubator Fund, which was to be run by the London Development Agency, was intended to help charities build bidding capacity, put together consortia and manage cash flow.
The LDA has been asked to make £44m of cuts, and a spokesman said this meant some services that had been in the pipeline had to be shelved.
"No expenditure has been committed to the Mayor's Incubator Fund because it is still in concept phase and no commitments have been given for funding," he said.
"We have been able to ensure that none of our current investments to deliver front-line services via the third sector are being cut."
Peter Lewis, chief executive of London Voluntary Service Council, said the fund had been "innovative and forward-looking", and would have helped the voluntary sector to support the most deprived people in the capital.
"At a time when the delivery of public services by voluntary and community organisations is being trumpeted as a core part of the big society, it is astonishing that the LDA has cut this fund," he said.