The Ontario government's anti-bullying legislation passed third and final reading Tuesday, a bill that calls on all publicly funded schools to allow students to form clubs called gay-straight alliances.

The legislation, known as the Accepting Schools Act, has raised the ire of Catholic leaders, who say it imposes on their religious freedoms and will require them to act against the tenets of their faith.

But Ontario Premier Dalton McGuinty said the new law represents "values that transcend any one faith.

"I am convinced that once we have this in place that Catholic schools, Catholic teachers, Catholic principals, Catholic parents will understand its true significance."

The premier told reporters at Queen's Park that the move is "about building a stronger, more cohesive society where we all accept that ... discrimination against children on the basis of whatever, including their sexual orientation, is no longer acceptable."

Thomas Cardinal Collins, Archbishop of Toronto, issued a statement on behalf of the Assembly of Catholic Bishops of Ontario to express "serious concerns about certain aspects" of the bill.

"Recognizing that the Accepting Schools Act is now the law, Catholic partners will seek, as we have always done, in a way that is in accord with our faith, to foster safe and welcoming school communities," Collins said.

Jack Fonseca of the Campaign Life Coalition said the bill will "sexualize the classroom from kindergarten through grade 12 and violates the freedom or religion.

"This is the first time in Canadian history that a government has taken away freedom of religion from a group," he said.

Rev. Brent Hawkes of Toronto's Metropolitan Community Church accused the Catholic Church and others of opposing the bill "every single step of the way, "so they were consistent today in opposing, again, making the world a better place for gays and lesbians."

The bill passed with NDP support, but was opposed by the Progressive Conservatives.

"Our position is that principals run the schools with the parents and school boards, not students," said PC Leader Tim Hudak.

"Our economy is heading backwards, our province is bankrupt (and) you folks are asking questions about names of student clubs."

NDP Leader Andrea Horwath said "a lot of people from the Catholic community" support the legislation.

"We just have to make sure that the implementation happens and that kids are able to combat bullying of all kinds in their schools," she said.

The Tories accused the Liberals of adding the language about gay-straight alliances to the anti-bullying bill in an effort to kick-start a debate on funding for Catholic schools.

"I can only suppose that must have been quite deliberate on the part of the Liberals to open up that whole debate, because we're very clearly heading in that direction," said Christine Elliott, the Tories' deputy leader.

"It is a concern. We learned very clearly in the 2007 election that's something that people feel very strongly about, and I don't think we want to have another debate on religion in schools."

Then-Conservative leader John Tory lost the 2007 election after proposing opening up public funding to schools of other faiths.

The Liberals deny the charge that they're trying to reignite debate over Catholic school funding, as well as suggestions that they will use the legislation as a starting point to bringing forward new sex-ed curriculum.

Elliott also accused the government of trying to make the Tories appear homophobic.

"It's about trying to wedge us for their own political purposes and I think that's a great shame," she said.

But McGuinty said that while protecting children from bullying has little to do with partisan politics, the Tories' opposition to the bill "has everything to do with the fact that we're going to be talking about gay-straight alliances in Ontario high schools."

McGuinty said the Tories are "missing an opportunity to take a stand on behalf of our generation to say to all and sundry discrimination against people based on sexual orientation is not honoured in Ontario."

With files from The Canadian Press and a report from CTV Toronto's Paul Bliss