Ian Luder, the former Lord Mayor, has reportedly had his impending knighthood dropped after defending bankers’ bonuses.

Mr Luder, the 681st Lord Mayor was allegedly due to receive a knighthood in tomorrow’s New Year Honours List but will be the first Alderman to be denied it in more than 50 years.

In June Sir Gus O'Donnell, Cabinet Secretary, head of the Home Civil Service and chairman of the main Honours Committee said that Lord Mayors could no longer expect to automatically receive a knighthood.

He wrote in the Daily Telegraph: “There are no longer ‘automatic’ knighthoods for those who might have expected to receive them simply because of the post they held: leaders of professional bodies, chairs of large companies, lord mayors of London or permanent secretaries in the Civil Service.

“Just like any other recipient, such people now have to stand head and shoulders above others and have contributed to the wider public good.

“The vast majority of awards go to ordinary people doing extraordinary things in their communities, people whose achievements would otherwise go unrecognised by the wider world.”

Earlier this year, Mr Luder defended bankers’ bonuses and emphasised the importance of protecting growth and competition in the financial sector.

A spokesman for the City of London Corporation said: “The Honour’s List is entirely a matter for the Honours committee. In recent years it has made clear the criteria have changed and these continue to evolve.

“This does not change the fact that the work Lord Mayors do as global ambassadors for the financial service industry is extremely valuable and contributes greatly to the UK, London and the country.”