Boris Johnson has denied claims that he threatened not to stand again as London's Mayor in a bitter row with the Treasury over spending cuts.
The former Conservative MP was reported to fear he would fail to be re-elected in 2012 because of government plans to cut funding for his key transport projects including Crossrail.
The Sunday Times reported Mr Johnson would attempt to return to Parliament after leaving his post – causing a potential headache for David Cameron with whom he has had a difficult relationship.
But his spokeswoman said: "The Mayor has made it clear that he will decide his future at a time when he can assess his success as Mayor. He is mulling over that decision this summer." A source close to Mr Johnson added that he was not threatening to resign and was expecting a "good" settlement for London.
The dispute is understood to centre on the £16bn Crossrail project, scheduled to open in 2017, which could, acccording to the report in The Sunday Times, be slashed by £800m if a proposed 5 per cent budget cut goes ahead. Mr Johnson may also lose money for Tube network improvements, which would have been popular with voters.
An anonymous source told the newspaper: "We will die in a ditch for Crossrail and the Tube improvements. These upgrades are hanging in the balance and if Boris doesn't get the money he needs, they won't happen."
The threat of cuts to Mr Johnson's schemes will boost the position of former mayor Ken Livingstone, who plans to run again in the next election.
The source said: "We have already had to put fares up and that is Ken's primary line of attack. Boris will find it difficult to get re-elected."
In June, Mr Johnson allegedly called off a planned announcement about his intention to run again because of a tense dispute with the Government over his share of central government funds.