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Ontario Premier McGuinty speaks to the media after making an announcement to resign from the leadership of the Ontario provincial Liberal party at Queen's Park in Toronto on Oct. 15, 2012.MARK BLINCH/Reuters

In a surprise move, Ontario Premier Dalton McGuinty announced his resignation Monday evening.

Just one year after winning a third mandate, Mr. McGuinty called his caucus together around the dinner hour at Queen's Park. With his wife, Terri, sitting in the front row, he said he plans to step down as Premier and as leader of the Liberal Party. He will hold on to his seat in the legislature, representing Ottawa South.

"It's time for renewal," he said. "It's time for the next Liberal premier, it's time for the next set of Liberal ideas to guide our province forward."

Mr. McGuinty, who won the leadership of his party 16 years ago, said he will stay on until a successor is chosen.

He said he also met with Lieutenant-Governor David Onley earlier Monday to ask him to prorogue the legislature. Mr. McGuinty said he wants his government to be able to pursue its plans to freeze wages for public sector workers "free of the heightened rancour that has sadly too frequently characterized our legislature of late."

Mr. McGuinty invited reporters into the caucus meeting to hear the announcement, which was made well into his remarks to caucus members. "Are you ready for this?" he joked. He did not immediately take any questions from the media.

Mr. McGuinty said there was no magic in resigning Monday. He also defended his decision to prorogue the legislature saying Ontario sits more than any other in Canada. He added the move will give the party time to develop a new agenda.

Mr. McGuinty would not say when he will recall the legislature and will leave that up to the new leader.

When asked specifically if he was interested in the federal Liberal leadership race, Mr. McGuinty said he "has no plans whatsoever." However, he did not specifically rule out entering the race, insisting only that he has no plans beyond serving as premier until a new leader is in place.

Mr. McGuinty was pressed repeatedly on the federal leadership race but only smiled and said he has "no plans."

First elected premier with a majority government in 2003, he won a second term in 2007 but was reduced to a minority last year.

Last month, his party missed a chance to secure a majority when it lost a by-election in Waterloo.

Mr. McGuinty met with his caucus after a series of dramatic developments throughout the day at the provincial legislature. The opposition accused senior cabinet ministers of misleading the legislature by insisting that they had disclosed all documents relating to two cancelled power plants when in fact they were aware that was not the case.

The Progressive Conservatives initiated a process that could ultimately lead to cabinet ministers being found in contempt of Parliament, when Tory MPP Todd Smith called on Speaker Dave Levac to rule there is evidence government members misled the legislature.

"I am of the belief that the government misled the House," Mr. Smith told the legislature.

Energy Minister Chris Bentley is already facing a rare censure over his refusal to release documents to a legislative committee last May. The Finance Committee has until Nov. 19 to determine whether he should be held in contempt.

The controversy surrounding the cancelled projects deepened on Friday after the government released another 20,000 pages of documents that were not identified as part of the initial search.

With the legislature now prorogued, all business grinds to a halt, including the move to find Mr. Bentley in contempt of parliament.

"There is no reason to shut this place down," Progressive Conservative Leader Tim Hudak told reporters Monday night. He vowed that his party will pursue the contempt issues, saying they won't go away just because Mr. McGuinty has prorogued the legislature.

NDP leader Andrea Horwath also criticized Mr. McGuinty for proroguing the legislature. "The people who make this province work everyday sent us here to do a job. And that work shouldn't stop while the Liberal party focuses on their leadership race," Ms Horwath said. She also said it crossed her mind that Mr. McGuinty prorogued the legislature to avoid contempt issues that have embroiled the legislature lately.

Former PC leader John Tory said last night that Ontarians should acknowledge the sacrifices Mr. McGuinty and his family have made in the cause of public service.

"There will be plenty of time in the weeks and months ahead to judge his record in office. Like any such record, there are good parts and those not so good," he said.

"Part of that record will be the decision to prorogue the Legislature at this time when we need transparency and accountability more than ever. While there may be practical reasons behind that decision, I don't think it will be seen as a good decision, short or long term."

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