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Thursday, January 15, 2015

Will Sousa challenge Ontario’s Beer Store monopoly?

According to a report on thestar.com website, Ontario Finance Minister Charles Sousa is brewing up changes that are designed to address the unpopular private monopoly enjoyed by foreign-owned beer companies Labatt, Molson and Sleeman through their ownership of the Beer Store.

A section of Ontario’s Liquor Control Act gives the Beer Store a monopoly as the only private firm allowed to sell beer directly to consumers without brewing it on its premises. This status is, apparently, being challenged by lawsuits such as the one launched by a Burlington pub owner in a potential class-action against the LCBO and Beer Store.

The legal challenge comes on the heels of Toronto Star columnist Martin Regg Cohn’s story about a secret 14-year-old pact that limits competition between the provincially owned Liquor Control Board of Ontario and the privately owned Beer Store.

According to Regg Cohn’s story, the LCBO agreed it would sell only six-packs of beer to consumers and would not sell two-fours to restaurants and bars.

“We’re going to maximize the benefits to consumers and protect the industry at the same time. We’ll review the whole thing,” said Finance Minister Charles Sousa who, reportedly, will unveil changes in his budget in March.

Readers have probably heard of the ten scariest words in the English language: I’m from the government and I’m here to help you. Well, hang on to your hats because Sousa’s words seem to convey similar sentiments, i.e., “We’re going to maximize the benefits to consumers ….”

When the Ontario government—yes, the McGuinty-Wynne government—says it plans to maximize benefits to consumers, they are using code for we’ll gouge more money out of you, but we’ll call it a benefit. The Ontario Grits are all about tax and spend and making cosy deals with their friends and financial benefactors. Consumers are their cash cows.

I’m sure Sousa will make some changes. He needs to address the Beer Store’s status, which is becoming a real embarrassment to his government. And may be beer, especially craft beer, will be more available, perhaps more convenient to buy.

But count on beer still being taxed and marked up to the hilt and still being tightly controlled and though we were a province of ten-year-olds who need Granny Wynne to take care of us and make us pay through the nose for the privilege.

1 comment — This is a moderated blog and comments will appear when approved. Please don’t resubmit if your comment doesn’t appear immediately, and please do not post material that is obscene, harassing, defamatory, or otherwise objectionable.

  1. Such is the complexity of the symbiotic LCBO-Beer Store relationship, I doubt if anyone other than the participants know what was agreed to in the murky non compete agreement.
    There are at least 3 types of LCBO stores in Ont; the large urban emporiums, the combined Beer-Liquor stores in smaller centres and the 230 Agency privately owned Agency stores selling all Beer and liquor products, Obviously nothing legally prevents LCBO from selling beer in whatever containers they wish, as the last 2 types do exactly that. In these outlets the stocking of beer and other products seems to be at the discretion of the manager, which is as it should be. They stock what customers are apt to purchase.
    Thus locally my grocery store carries far more Ont craft beer than the official LCBO outlet a few miles away. In my experience much of the "craft beer" stocked in LCBO stores is imported and the breweries are owned by multinational giants like Guinness and the same firms owning the Beer Store. LCBO would far sooner deal with the giant brewers than be bothered with micro Ont entities.
    Whatever Liberals come up with it will not include expansion of the 230 Agency grocery outlets, unions have put a stop to that popular program. Anything else is simply smoke and mirrors, and consumers are absolutely the last group to be given any consideration.

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