Achi news desk-
As politicians and new cabinet ministers leave Queen’s Park for an extended summer break, arguments over the cost of early delivery of the Ford government’s signature policy continue.
In late May, Ontario Premier Doug Ford held a news conference in an increasingly familiar location: a Toronto gas station with makeshift shelves of beer, wine and mixed drinks stacked behind it.
The prime minister, alongside his finance minister, announced that an already public plan to sell beer in grocery stores and corner stores would be dramatically accelerated. Rather than starting in 2026, the new policy means that a gradual expansion will now start on August 1.
After Sept. 5, eligible convenience stores will be able to sell beer, cider, wine and ready-to-drink cocktails, and after Oct. 31, all grocery stores and big box stores could sell those products, including large packages. Over time, the changes will add up to 8,500 new places where people in Ontario could buy alcohol, the government said.
The cost? That depends on who you ask.
Ford and Finance Minister Peter Bethlenfalvy said a maximum of $225 million had been set aside to help The Beer Store transform and keep some stores open.
The Ontario Liberals claim the true cost is north of $1 billion.
‘Billion-dollar drink boondoggle’
Days after the announcement was made, the Ontario Liberals issued a bold claim, suggesting the true cost of the change was more than $1 billion.
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The party suggested the province would be hit on four fronts through the new deal: money for The Beer Store, LCBO rebate fees, wholesaler discount and lost license fees.
To arrive at its figure, the Liberals took the full $225 million announced by the government, plus an estimated $375 million currently paid by The Beer Store to the LCBO.
The Ford government’s beer liberalization plan includes allowing grocery stores to buy products from the LCBO at a 10 percent discount. The Liberals argue it would cost a “low estimate” of $150 million over two years before the rate is renegotiated in 2026.
Finally, the Liberals believe Ontario could have raised more than $300 million if it had auctioned alcohol sales licenses, instead of allowing stores to sell booze at no extra cost.
“This billion dollar booze boondoggle is the latest example of Doug Ford lining the pockets of the wealthy, well-connected few at the expense of the people of Ontario,” Ontario Liberal Leader Bonnie Crombie said in a statement.
“Ford’s friends in the major grocery chains – already making billions in record profits – and America’s big box stores are going to kill.”
The Ontario Liberals suggest those numbers may be the “tip of the iceberg” and do not include lost revenue to government coffers if fewer people shop at LCBO stores.
When confronted with the numbers on Thursday, Minister Bethlenfalvy said there was no truth to the Liberal figures but he would not be drawn on some of the costs, beyond the $225 million payment to The Beer Store .
“Those are constitutional numbers,” he said. “The only way you could get to the numbers like that is by increasing fees and taxes and that’s not our plan, in fact just the opposite.”
In particular, Bethlenfalvy disagreed with the calculation that $300 million plus was lost by failing to charge for permits.
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Pre-mixed, 30-pack beverages are coming to Ontario’s big-box grocery stores
“That is definitely wrong,” he said.
“If you layer in the fees set by previous governments and you extrapolate whether they are license fees or other fees then you can arrive at a number. But that is not what this government is doing.”
May’s announcement of Ontario’s fast-drink timeline fueled early election rumors that the government has failed to shut down, while the premier heralded the policy as people “finally being treated like adults .”
Ford was at pains to argue that the $225 million his government will pay The Beer Store – owned by Labatt, Sleeman and Molson – is not “money in their pocket” but rather to avoid redundancies mass for Beer Store employees.
“What we’re doing, we’re supporting the frontline workers at The Beer Store … we’re going to be audited every step of the way, to make sure it’s be distributed in the right way,” said Ford.
Bethlenfalvy declined to be drawn on what the early expansion of alcohol sales would ultimately cost, instead reiterating that he would include the information in his regular financial updates.
“The numbers we’ve been told are up to $225 million. We said we would update the numbers as the market opens,” he said.
“Costs are going to be flat, we’re not going to deal in theories.”
& copy 2024 Global News, a division of Corus Entertainment Inc.
