WINDSOR, Ont.—Ontario’s premier is willing to act on an advisory panel’s ideas about optimizing public assets, but she wouldn’t directly say if that includes targeting the profits of the foreign-owned Beer Store.
After a speech to rally hundreds of Liberals at the party’s provincial council meeting in Windsor, Ont., Kathleen Wynne spoke about the work by the special panel, headed by Ed Clark, president and CEO of TD Bank Group.
The panel won’t report until next spring, but Clark said it is recommending the government—which is facing a $12.5-billion deficit—maintain ownership of the Liquor Control Board of Ontario (LCBO), Ontario Power Generation (OPG) and Hydro One Inc.
There are “significant” ways to improve the operations of those companies, he said.
But when it comes to the Beer Store, run by three foreign-owned brewers, the virtual monopoly should give taxpayers “a fair share of the profits,” Clark said.
Wynne praised Clark’s “challenging ideas” and said she is “absolutely willing” to tackle them.
“Will it be easy? Will it be a path that is without any challenges? No, it won’t be,” Wynne said.
“But that’s not a problem from my perspective. That’s exactly why it needs to be taken on, and quite frankly, if there have been governments before that have thought about taking on some of these challenges and then have not done them, then that’s a measure of the difficulty of the challenge.”
But when pressed specifically if her message was that she would be going after Beer Store profits, Wynne’s answer was less clear cut.
“My message is to the people of the province: We’re going to make these assets work for you,” she said. “We’re going to make sure that we have, to the greatest degree possible, a rational distribution system, whether it’s of beer or other alcoholic products. We’re going to build on the good distribution system that we have.”
Clark also warned that the government must structure a deal with the Beer Store so it doesn’t result in higher prices.
It’s no surprise that Canada’s National Brewers warned that adding new taxes to the Beer Store—along with a recommendation to allow the LCBO to sell 12-packs of beer in addition to six packs—”is a recipe for higher beer prices,” he said.
Progressive Conservative Monte McNaughton said the fact that Clark couldn’t rule out beer prices rising sends a signal that the Liberals will “jack up” alcohol prices.
“The people of Ontario are going to be paying more in taxes and fees likely when it comes to the cost of alcohol because of the decisions the government’s making,” he said.
“They’re desperate for cash. These are desperate times for the Liberals. They’re going to be finding any way possible to raise revenues instead of reducing spending.”
The New Democrats are against selling off public assets and Windsor MPP Lisa Gretzky said she believes efficiencies can be found to avoid those measures.
The Clark panel is recommending changes to the way booze is priced and marketed, so the LCBO acts more like a retailer.
Selling 12-packs at LCBO stores would be like adding another 600 Beer Stores in Ontario when it comes to consumer convenience, Clark said.
The panel is also recommending that Hydro One focus on transmission and get out of the local distribution business, as well that OPG should split into two entities, one to focus on the refurbishment of the Darlington nuclear station while the other looks after the more “straight forward” hydro-generated electricity business.