Despite past differences, newly minted federal Liberal Leader Stéphane Dion is a good choice for Ontario, Premier Dalton McGuinty says.

"He's got a good understanding of Ontario's issues, its challenges and potential," McGuinty said. "I'm convinced we can work well together."

Stéphane Dion waves to delegates following his victory speech on Dec. 2.
(Ryan Remiorz/Canadian Press)

McGuinty has repeatedly blasted Ottawa for short-changing Ontario on cash transfers to the provinces.

Dion has refused to recognize any fiscal imbalance, and was critical of the Ontario Liberals for raising the issue during the 2004 federal election campaign.

However, McGuinty says that is in the past.

"The party has grown and I am sure that Mr. Dion will learn more in his new capacity," the premier said, adding that delegates at the Montreal convention passed a resolution agreeing that there is indeed a fiscal imbalance.

McGuinty reportedly made his first pitch to Dion about giving Ontario a better deal while standing on the stage of the Montreal convention with him Saturday night, just after the announcement of Dion's victory.

McGuinty seemed pleased with Dion's victory speech, saying he "sounded the right note" when he spoke about establishing a federation that respects provincial interests.

The premier said he hopes Dion will work to convince the Conservative government that Ontario's auto industry is not the only sector needing to slash air pollution.

With files from Canadian Press