Corstorphine Baptist Community Trust chief executive and roundtable member Wendy Halsey said the move followed a "candid" meeting last month at which funding decisions were challenged.
The roundtable was set up about a year ago to improve communication between the board, community providers, and mental health users.
The meetings were hosted by planning and funding staff, who took the minutes.
DHB senior mental health staff also attended.
The roundtable was an important and rare link between the board's funding arm and the community, Miss Halsey said.
Community providers felt unfairly targeted in the board's cost-cutting drive, so it was poor timing to end communication, she said.
Many community providers were too frightened to speak out publicly.
"I would hate to think it gets to the point where people are afraid to speak out for fear of being punished."
She said Corstorphine, which is funded for residential and home-based support for adults and young people with mental illness, was not as vulnerable and felt responsible for smaller organisations, such as Advisory and Support Centre Otago, which recently lost DHB funding.
Otago Mental Health NGO Group chairman Donald Shand, who chaired the monthly gatherings, was "surprised" by the move, after what he described as an "animated" yet reasonable meeting.
He was not sure what issue upset the staff member.
"I was surprised when the roundtable was notified it was going to be discontinued ... [and that] one planning and funding person felt uncomfortable at the last meeting."
Mr Shand planned to reconvene the meetings, without planning and funding staff, at a different venue, with DHB senior mental health staff understood to be willing to attend.
Southern District Health Board planning and funding general manager David Chrisp said: "I have yet to get to the bottom of this matter. I need to speak to a few people to understand the background".
