The body formed by eight London councils served more than 300,000 homes and claimed it represented a massive forward spending programme over the next four years.

Apollo, Bramall Construction, Breyer Group, Kier, Mears and Vinci were among a long list of contractors on Cyntra’s qualified suppliers list.

The firms completed a lengthy vetting process last year to earn a place on a new national building framework but now are unlikely to see any of the promised £800m work.

A long list of subcontractors on Cyntra’s specialist London framework will also be let down on the promise of sharing £200m of planned repair and maintenance work.

A source told the Enquirer: “The prequalification procedure has probably cost each firm £50,000. Everybody must be spitting blood that nothing will come of it.”

Cyntra was formed by Barnet, Ealing, Hammersmith and Fulham, Kensington and Chelsea, Hillingdon and Hounslow councils seven years ago.

More recently Cyntra widened its ambitions and forged links with over 20 housing groups and councils around the country as it vied with several other procurement groups for national dominance.

The insider added: “The procurement group was set up by eight London Council’s to save money. They hardly used it and now they have suddenly pulled the rug.”

Cyntra claimed it could deliver savings on new contracts in excess of 13%, with 1% annual savings using its OJEU qualified list of approved contractors and specialists.

The liquidators are understood to be looking at whether they can sell on the framework agreements to any councils.