Ontario Premier Dalton McGuinty denies he had a direct role in hiring Sarah Kramer as the CEO of eHealth, but says it was a "mistake" to give her the job.

Kramer resigned last June after news broke of consultants getting $16-million worth of contracts and spending thousands of dollars on travel expenses, food, parking -- and even business cards.

Dr. Alan Hudson, chair of the arm's-length agency's board, also resigned.

"In hindsight, it's obvious that we made a mistake," said McGuinty.

"But at the time the best advice that we had was that Ms. Kramer, who was playing an active role at Cancer Care Ontario, was performing very well. And based on that advice and the strongest recommendation, I thought it was the right thing to do -- we all thought it was the right thing to do."

McGuinty said Kramer won the appointment through an order-in-council, and that he met with her first as a "formality."

"I do this from time to time with senior government officials, it's just an opportunity for them to meet with the premier, for me to look them in the eye and say: 'Look, this is important, we've got to find a way to get this done, let's move along with this,'" he said.

Hudson, an eHealth board member, was one of the people who recommended Kramer.

"Obviously, Dr. Hudson was a strong influence in all of this; I relied heavily on him," said McGuinty.

Opposition members have demanded an inquiry. On Wednesday, NDP member Peter Kormos repeated that call.

"The premier is going to have to wear it, somebody has to accept responsibility, he can't constantly wring his hands and say somehow all this stuff happened without his knowledge," he told The Canadian Press.

"These jobs don't get filled without being cleared by the premier's office. The premier may not have heard personally from some of the bureaucrats, but the bureaucrats have made it clear that they warned the premier, through his office, of their concerns."

Ontario's auditor general is currently examining the agency. An independent review by PricewaterhouseCoopers had also been promised, but the government cancelled it, saying it would be redundant.

The province started eHealth last year to move the medical records of Ontario residents into electronic files. Another agency, Smart Systems for Health, had attempted the same task, at the cost of $650 million, but never finished.

With files from The Canadian Press