The Public Works Department last week formally asked for bids to clear "invasive vegetation" and to plant trees on the steep escarpment that drops from behind the Parliament Buildings to the Ottawa River.
Firms were asked to inspect the site this week, and bids were to close by Nov. 1.
But Public Works Minister Rona Ambrose has abruptly ordered officials to cancel their plans as too expensive.
Her spokeswoman, however, says Public Works will continue to examine cost-effective ways to prevent erosion on the slopes.
The reforestation project was part of a multibillion-dollar plan to upgrade the Parliament Buildings, which has met with numerous setbacks and cost overruns.
Under the latest project, 6,400 tree seedlings would have been planted along with shrubs and other vegetation, while so-called invasive trees such as the Norway maple would be removed. Stumps and dead trees would be carted away as well.
"The contract is too expensive," the minister's spokeswoman, Michelle Bakos, said in an email.
"That is why Minister Ambrose has instructed the department to cancel the contract immediately.
"Nevertheless, the escarpment behind Parliament Hill needs to be reinforced due to erosion. Public Works officials have been instructed to find a more affordable way to address this problem."
At least one naturalist had derided the original plan as misguided.
The cancellation marks the second time this year a federal tender has been cancelled after coming under public scrutiny.
A tender for stress-reduction therapy for staff at the federal Justice Department was pulled soon after media outlets reported that the program would "help individuals to deal more effectively with difficult thought and emotions that can leave you feeling stuck in everyday life."
The official tender posted in March called for a series of sessions for up to 40 staff members, with the Justice Department supplying refreshments and venues.
Total cost was set at more than $23,000, and was initially defended by a Justice spokesperson — before the department cancelled the project days later.