OTTAWA - Industry Minister Tony Clement denied Monday he directed his department to give any special scrutiny to gay-themed tourism events, and lashed out angrily at opposition suggestions that homophobia motivated government funding decisions.

Clement insisted he did not oust cabinet colleague Diane Ablonczy from the helm of a tourism program after she approved funding for Toronto's gay pride week.

"I know you're looking for the smoking gun or some sort of other agenda but quite frankly, you know, to be accused as I have been accused by (Liberal MP Marlene) Jennings to be some form of homophobe, you know, quite frankly I find that offensive and anyone who knows me knows that that's ridiculous," Clement told reporters.

The Canadian Press reported this week that Clement had a direct hand in formally revoking Ablonczy's authority over the Marquee Tourism Events Program, as outlined in a letter his chief of staff sent to bureaucrats last June.

The letter came just two weeks after Ablonczy had handed over $400,000 in funding to Toronto Pride, a move that incensed Canadian social conservatives and some in the Tory caucus during its last meeting before the summer break.

An internal memo, obtained through Access to Information legislation, also indicated bureaucrats were told to "scrutinize" tourism activities, on the same day Ablonczy was turfed from the program.

"The Minister of Industry recently ordered bureaucrats to scrutinize tourism events directly related to gays, lesbians, women's groups and so on," Jennings told the Commons.

"Will the Conservatives now tell Canadians exactly which groups are on their black list for special scrutiny?"

Clement told reporters he had no problem with any tourism event that had received funding to date, including Toronto Pride.

Montreal's Divers-Cite gay cultural festival was told by bureaucrats it met all the criteria for funding under the program, but was rejected at the ministerial level.

"The fact of the matter is some of those programs got grants, others didn't," Clement said. "We didn't fund every folk festival. Calgary Folk Festival got funding but Mariposa Folk Festival didn't. That's doesn't make me folkophobic."

But a senior government source familiar with the file said there had never been any indication that Ablonczy's control of the tourism program was only temporary. Ablonczy was described as passionately committed to the impartiality of the funding.