The BBC is understood to have cut its marketing, communications and audiences division's budget of around £100 million by an initial £20 million for the new financial year, at the start of April.
The reduction will increase over the next three years to 25 per cent until the end of the current licence fee period in 2012-2013, according to a report in The Guardian.
The budget affects the BBC's on-air promotional campaigns, print and billboard advertising, cinema advertising and corporate events.
Earlier this month, Campaign revealed the BBC put the launch of an ad for BBC Radio 1, created by Fallon, on hold because of fears of a backlash from licence-fee payers.
Current TV ad campaigns for the BBC include an ad for BBC Blast, "fashion advice" by Fallon, featuring an animated robotic dog, and an on-air promotion of the BBC iPlayer featuring the strapline: "Making the unmissable unmissable."