OTTAWA - The Harper government is being labelled homophobic for refusing to fund Toronto's gay pride festival this year.

The festival received $400,000 last year from the Marquee Tourism Events Program but it won't get a nickel this year.

Industry Minister Tony Clement insisted Friday the decision has nothing to do with anti-gay sentiment among some members of the ruling Conservative caucus.

Rather, he said the government decided to fund fewer events in major cities this year so it can spread the money around more equitably to smaller centres.

But festival organizers and opposition critics maintained homophobia was behind the decision. And they claimed exclusion of the pride festival is part of a pattern that suggests hard-right, social conservatives are now in charge of the government.

The decision not to fund the festival comes on the heels of recent funding cuts to women's groups and the government's refusal to fund abortion as part of Prime Minister Stephen Harper's G8 maternal health initiative.

"This is again another example, in my opinion, of a reckless, ideological cut from a Conservative government which actually has a history of attacking gay rights," said Liberal tourism critic Navdeep Bains.

Pride Toronto executive director Tracey Sandilands pointed out some Conservative MPs were aghast last year when Diane Ablonczy, then tourism minister, gave the festival $400,000.

Shortly afterward, responsibility for the marquee program was shifted from Ablonczy to Clement. Tory MP Brad Trost told an anti-abortion website that Ablonczy was being punished for making a funding decision that was not supported by "a large majority of MPs."

Trost's interpretation of events was denied by the government but Sandilands said the flap was a clear sign "there was definitely homophobia at work then."

This year, she said the qualifying criteria for funding has not changed and other events, including the Calgary Stampede, have received funding for the second year in a row.

"That indicates to me that something has changed between last year and this year and it's not our eligibility," Sandilands said.

"So the only thing it can be is some kind of homophobia. I mean, it makes sense."

But Clement said in an interview it's inaccurate to say the pride festival's funding has been "cut off." He said there was "a whole new application process" this year and no event was guaranteed to get money just because they got some last year.

Last year, Clement said the lion's share of the marquee program's funding went to large urban centres, particularly Toronto and Montreal. This year, the major cities were limited to two successful applications, allowing the government to spread the largesse around to smaller centres across the country.

The two Toronto events that will get funding are the Luminato arts festival and the Royal Agricultural Winter Fair. Clement said both are making new attempts to reach international audiences.

By contrast, he said the pride festival is "a very successful event, it's obviously able to stand on its own two feet."