George Smitherman has stepped down from Premier Dalton McGuinty's cabinet to run for mayor of Toronto next fall.

Smitherman, who has mused about a municipal bid for months, made it official during a meeting at McGuinty's midtown home Sunday, tendering his resignation as deputy premier and minister of energy and infrastructure.

"I'm not someone who's going to operate well with one foot in two camps," the Etobicoke native said in an interview with the Toronto Star.

"I've taken myself out of the realm of speculation and moved into the realm of certainty. I want to take that track record of getting things done to my city," said Smitherman, who will remain as Liberal MPP for Toronto Centre until he officially launches his mayoral bid before March.

Sources said veteran Gerry Phillips, a minister without portfolio who ran the energy ministry in the past, will be sworn in Monday as energy and infrastructure minister and serve till the end of the legislative session next month. There will be no deputy premier until after a larger cabinet shuffle in the new year.

Painting himself as "a candidate of the broad centre," Smitherman pledged to "build a campaign with people from all parties."

"It's time for post-ideological solutions," said the 45-year-old political trailblazer, who was Ontario's first openly gay MPP when he was elected in 1999 and was a key aide to former Toronto mayor Barbara Hall. He and his businessman husband, Christopher Peloso, are in the process of adopting a child.

Credited with implementing massive reforms to the province's health-care system as health minister from 2003 till 2008 – though opponents have blamed him in part for the eHealth Ontario spending scandal that cost his successor David Caplan his cabinet job last month – Smitherman said he would take his no-nonsense style to city hall.

With Mayor David Miller not seeking a third term next year, Smitherman and former Progressive Conservative leader John Tory, who is mulling a mayoral run, would be the frontrunners to be the most powerful civic politician in Canada.

Smitherman, who vowed to field a well-funded campaign, took some not-too-subtle shots at city councillors now considering a run for mayor.

"I love my city, I see such good things happening, but there's a sense of unrealized potential. How do you redress a psyche? Leadership," he said.

While reluctant to criticize Miller's performance during last summer's 39-day strike by city workers, Smitherman, who led much-publicized street clean-ups when garbage was starting to pile up, castigated those councillors who took pay raises prior to the job action.

"That really stuck in my craw as a failure of leadership. Councillors failed to convey a collective view of fiscal responsibility," he said.

Nor was he impressed by a suggestion last week from Councillor Shelley Carroll (Ward 33-Don Valley East), the city budget chief and a possible mayoral candidate, that Toronto should impose a municipal sales tax.

"A lot of people were shaking their heads and ... there's folks that were saying, `They don't get it.' There is only one taxpayer."

While Smitherman had been wavering on whether to make the jump to city politics after Auditor General Jim McCarter's scathing report into eHealth, he said comments from friends reignited the fire in his belly.

"Someone said to me, `Well why would you want to be mayor, it's a powerless job.' It's not a powerless job – it's a bully-pulpit," he enthused, emphasizing he can govern in a "constrained fiscal environment" by being "innovative" and "transformative."

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Having spearheaded sweeping reforms of Ontario's health system and overseeing a budget of more than $40 billion, which dwarfs the city's $8.7 billion in spending this year, Smitherman is no stranger to wrestling with the vast bureaucracy inside a huge, intransigent organization.

"There's a dose of fiscal reality that needs to be brought to bear," said the man who also championed McGuinty's City of Toronto Act, which gave the cash-strapped municipality increased taxation power.

While his mercurial temperament has led some to dub him "Furious George," even his political foes grudgingly admit he is a big-hearted and fearless competitor.

Nine days ago outside the Liberals' annual general meeting in Windsor, a Star reporter and a Tory operative watched in astonishment as Smitherman sprinted to help stop a street brawl between some drunken teenagers before the police had even arrived.

His departure from cabinet robs McGuinty of his most powerful minister at a time when the province is facing a $24.7 billion budget deficit, the possibility of unpaid "Dalton Days" for public servants looms, and a new 13 per cent harmonized sales tax that comes into effect July 1, 2010.

While the premier's office had no comment Sunday, Smitherman said he had a cordial meeting with McGuinty.

"He was somewhat surprised about it, of course. But he was just so generous in his comments and his good wishes for me – more than I could have hoped for. We have a rock-solid relationship and we've been good partners," the MPP said, adding he thanked the premier "for the patience you've had with me."

His move caught cabinet colleagues off guard – the Star spoke with several ministers late Sunday who expressed surprise that he was leaving so soon.

But Smitherman, who hosted a celebratory party Friday at Labatt House to mark Toronto being named host of the 2015 Pan Am Games, said he and his husband decided the time was right.

"There's a lot we can do yet in Toronto."