Film London, the agency charged with supporting and developing film-making in the UK capital, has been boosted with the news that its most significant funding for the next financial year has been secured, albeit with a 22% cut. The Mayor of London's office announced that, for 2011/12, Film London will receive £1.3m from the London Development Agency (LDA), down from £1.66m in the previous funding round.

In making the announcement, London's mayor, Boris Johnson, said: "I am delighted that we are able to continue to support this industry, which contributes almost £4bn to the London economy." Adrian Wootton, chief executive of Film London, said the agency was "keen to build on our previous successes and continue to deliver for the city, for our film-makers of tomorrow and for domestic and international producers".

The LDA funding represents about 40% of Film London's total budget. Film London's other funding could also be on the slide. The Arts Council, which pays for the Film London Artists' Moving Image Network (Flamin), has dropped its award from £343,770 in 2010/11 to £320,049 in 2011/12. The UK Film Council in 2010/11 provided some £710,000 from the lottery and direct grant-in-aid funding – the following year's award is shortly to be announced after the transfer to the BFI. At the same time, Film London has been assigned the functions of the now-abolished British Film Commission, responsible for attracting non-British film-makers here.

Despite its reduced circumstances, Film London remains the only survivor of the network of regional film agencies that were set up by the UK Film Council after it took over in 2000. As part of the coalition's reorganisation of state funding, the regional agencies – which only covered England – will be absorbed into a new body called Creative England, the exact shape of which is yet to be decided.