Ontario's Minister of Citizenship and Immigration Mike Colle has resigned after an auditor-general's report deemed the Liberals did not provide an accountable and transparent process for awarding millions in grants.

Colle tendered his resignation after Auditor-General Jim McCarter revealed in his report that Colle's office awarded grants to multicultural groups without an accountable application process.

"The decision behind who got what were often based on conversations and not applications," McCarter said during a press conference on Thursday.

Premier Dalton McGuinty told reporters on Thursday that Colle's resignation was the "right thing to do'' and that he "wholeheartedly'' accepts the findings of the report.

He went on to apologize to Ontarians for not respecting their tax dollars and vowed the province would do a better job.

The Canadian Press is reporting Colle has been replaced by Government Services Minister Gerry Phillips who will be head of both ministries until the Oct. 10 election

Auditor's findings

McCarter stressed the need for due diligence in the grant application process and said time constraints for the Minister's Office of Citizenship and Immigration was not a sufficient excuse.

"More could have been done and quite frankly, more should have been done," McCarthy said.

Some organizations received funding well above what was requested, McCarter said. For instance, the Ontario Cricket Association requested $150,000 but got $1 million, he said.

The report also found that allegations into political ties between the groups and the Liberal party did exist, but these ties did not influence who received the grants.

McCarter's report investigated nearly $32 million in year-end grants that were hastily handed out to 110 community groups as the past two fiscal years came to and end.

McGuinty was given the report Thursday and kept his promise by promptly releasing it to the public shortly there after.

Opposition reacts

Opposition Leader John Tory slammed the Liberals saying grants were handed out "like Monopoly money."

Tory said McGuinty bears the ultimate responsibility for the lack of accountability and assured that the auditor's report would be an election issue.

"Very little illustrates Dalton McGuinty's lack of leadership as much as this," Tory said during a press conference.

"It took damning revelation after damning revelation before Dalton McGuinty, under duress, even allowed the auditor general to investigate this sorry mess. In short, they tried to do everything they could to hide this and to obscure this."

The opposition contended for weeks in the spring legislature that the money was awarded with no objective screening or application process.

After increasing pressure, McGuinty enlisted the auditor general to review the grants on May 10.

With files from the Canadian Press