London mayor Boris Johnson has announced £1.5m of Transport for London (TfL) funding will be invested in plans to transform the city's Jubilee Gardens.

Section 106 agreements secured by Lambeth Council means that around 75 per cent of the funding needed for the £5.5m scheme is now in place, following the mayor's announcement. The Jubilee Gardens Steering Group is leading the project, which is scheduled to be completed ahead of the 2012 London Olympics and the Queen's Diamond Jubilee.

Under the proposals, an area of grass adjacent to the London Eye attraction and opposite the Houses of Parliament will be revamped to create a new garden designed by architects West 8. Plans were initially approved by Lambeth Council in May 2006 but have been revised to create a "lush and green" park incorporating flowers and trees. Revised plans will be submitted in the summer.

Alan Bishop, chief executive of Southbank Centre, said: "This will be a world-class park and a focal point for 2012. Just as important is the partnership between the landowners and the local community that will maintain the park to the high standard befitting the cultural centre of London." The steering group behind the plans comprises the Department for Culture, Media and Sport; Merlin Entertainments London Eye; Coin Street Community Builders; Friends of Jubilee Gardens; Greater London Authority and Lambeth Council.

Shell; Shirayama; Southbank Centre; South Bank Employers' Group and the Waterloo Community Development Group are also part of the steering group.