Last year the main sponsors, trade unions Unison and Unite the Union, pulled the plug on their funding of the Finsbury Park event, leaving City Hall to foot the £551,000 bill.
Instead, this year the money will be used to fund a number of other events and grassroots activities across the capital.
A spokesperson for the Mayor said: "Without a major sponsor in place it is not considered appropriate to spend such a large amount on a single music event, particularly during a recession."
One of the new events planned is Rhythm of London, a two-day musical celebration partnerned by a number of organisations including The O2's and taking place from 10-11 July.
"We are planning a magnificent programme of events to get young Londoners enthused about music making, and give them a chance to shine," said Johnson.
To add comments, .