HAVELOCK, Ont. -

Ontario is slashing the budget for its 2015 Pan Am Games bid by $300 million because of the economic downturn, Premier Dalton McGuinty said Friday.

The provincial and federal governments, which are supporting the Toronto-led bid to host the Games, wanted to take a "leaner approach" to the project even though the economy will improve by 2015, he said.

"We just think that the world has changed a little bit, and our government has to reflect that in terms of the way we conduct ourselves," McGuinty said after touring an ethanol plant in the central Ontario village of Havelock.

"It just demands that we take a look at things like the Pan Am Games and make sure that we're acting as responsibly as we can."

The original budget was $1.77 billion, with $500 million coming from the federal government and the Ontario government promising to invest $621 million.

Cities would be expected to contribute a share toward construction if a new facility is built in their municipality.

The bid involves Toronto and at least 11 other municipalities throughout the Golden Horseshoe area in southwestern Ontario, from Niagara to Durham.

The Games would use existing facilities where available, but others would need to be built.

When McGuinty made the formal bid presentation in Mexico in October, he said new Olympic-sized swimming pools, a competitive cycling velodrome, plus track and sports training facilities would all be built if the bid is successful.

The CBC reported Friday that the cut won't have a dramatic impact, but it could mean some municipalities won't get the same level of economic spinoff they might have been hoping for from construction of new facilities.

Ontario's lack of high-level facilities has been blamed for the shrinking number of provincial athletes who make Canada's Olympic teams.

Ontario residents used to comprise more than half of the country's Olympic teams, and now it's less than 25 per cent.

The Pan Am Games bring together athletes from 42 countries across the Americas and the Caribbean every four years.