Transport for London (TfL) has agreed with the government to extend its existing support package till Friday, as negotiations continue to secure a long-term deal.
City Hall has said the financial cuts could push transport services back to what they were like in the 70s and 80s, unless it secures a multi-year funding deal to replace fares revenue lost during the coronavirus pandemic.
“This extension to the current funding deal until Friday will allow negotiations to continue,” said Mr Khan.
“The pandemic is the only reason TfL is facing a financial crisis.
“I urge the government to engage with TfL and City Hall in good faith so that we can finally agree a fair, long-term funding deal that will protect London’s transport network – for the sake of the capital and the whole country.
“London’s economy plays a huge role in the national economy and around 43,000 jobs outside London depend on TfL’s investment.
“If the Government fails to support TfL at this difficult time, it could impact TfL’s UK-wide supply chain, hitting jobs and growth and holding back the economic recovery in London and across the UK.”
A Transport for London (TfL) spokesperson said: "We continue to discuss our funding requirements with the government.
“There is no UK recovery from the pandemic without a London recovery and there is no London recovery without a properly funded transport network in the capital.
“It is essential London receives the sustained long-term government funding that is vital for the coming years if a period of ‘managed decline’ of London’s transport network is to be avoided.
"We have agreed with the government that our existing funding agreement will be extended until February 25 so that these discussions can be concluded.
“Working together, we must achieve a longer term capital funding settlement of at least three years that ensures
“London’s transport network can remain reliable and efficient, can support the jobs and new homes that rely upon it and can support the economic recovery of the capital and the country as a whole.
“We hope these discussions can be concluded successfully soon."
Transport Secretary Grant Shapps said: “We have provided TfL with a deal that both supports London’s transport network and is fair to taxpayers across the UK.
“They have asked for more time to consider the settlement, therefore we have agreed a short extension until February 25 for this to take place.”