Sale of the LCBO to OPSEU?

[DarnDirtyApe]

Because they support the government choosing what I can buy, where I can buy it, and when I can buy it. I happen to live in an LCBO desert - there is no store within 2KM of where I live - but that's too bad for me and anyone else who might see a missed opportunity.

Obviously MADD does a lot of good work, but I think that they overstep the core message (drunk driving).

 

[TOareaFan]

This is the downfall of society right here... just look at these people!

Who said anything about the downfall of society? MADD exists throughout North America, even in places where alcohol is sold without government interference, like San Francisco. So how does this organization stop you from enjoying your basic human right to drink in Ontario?

it is not even clear to me how having a single source of alcohol (the LCBO) stops or infringes on that right.

I may be odd (been told I am on many subjects) but I sit right in the middle of this debate all the time because, frankly, I just don't care. I drink (not as much as I did in my youth but I drink) but I am fully capable/able of getting my beer/wine/spirits whenever I need them.

When the topic of LCBO vs private sales comes up (as it does from time to time) it seems to dominate the public conversation for days and weeks....and I am left wondering why so many feel this is such a big issue.

 

[DarnDirtyApe]

Say I want to buy a particular craft beer or wine I read about in the newspaper... unfortunately, the LCBO has very onerous rules for producers to get their product into stores, and even then the LCBO decides which products end up in which stores. The LCBO actually does a fine job of supply "whatever" to the market, but they are a one size fits all approach that doesn't really work for many people.

 

[DarnDirtyApe]

Not at all... I wish the Liberal government would stop following their lead when it comes to alcohol sales. Everyone is free to an opinion!

 

[rbt]

I believe they make money selling milk and pop

Don't know about the rest, but Becker's certainly doesn't.

 

[TOareaFan]

Don't know about the rest, but Becker's certainly doesn't.

They may make individual decisions to use certain products as loss leaders to get people into stores and profit off of them as they buy other products with higher profit margins......perhaps.....but the sale of these products is not governed by some "not for profit" sales arrangement as was the suggestion I responded to.

 

[rbt]

They may make individual decisions to use certain products as loss leaders to get people into stores and profit off of them as they buy other products with higher profit margins......perhaps.....but the sale of these products is not governed by some "not for profit" sales arrangement as was the suggestion I responded to.

Oh yeah, it's intentional based on the assumption that you will (and many do) buy something else too.

The decision to carry, or not, alcohol on that type of arrangement I described would be similar; and many would. My favourite localish retailer of wine is still California Safeway (woo for the bottom shelf). Second is Rosedale LCBO.

 

[TOareaFan]

Oh yeah, it's intentional based on the assumption that you will (and many do) buy something else too.

The decision to carry, or not, alcohol on that type of arrangement I described would be similar; and many would. My favourite localish retailer of wine is still California Safeway (woo for the bottom shelf). Second is Rosedale LCBO.

but if we go back to your original comment that there be strict price controls based on retailing on a not for profit basis (ie. they would not be allowed to make any profit on the sale of booze) then I don't think they would be all that interested.....certainly not enough to pay for a license to sell the stuff.

But let's assume the province finds a bunch of retailers willing to sell booze on an not for profit basis........how, in that model, does the province fill the big income gap they would create for themselves?

 

[Tewder]

it is not even clear to me how having a single source of alcohol (the LCBO) stops or infringes on that right.

It's called a monopoly. Monopolies create an artificial market that favours the monopolizer, infringing on the consumer's right to fair economic/market competition. This is not a good thing, whether you like alcohol or not.

What's more, this is a government monopoly (likely an anti-constitutional one), which means our government levies (high) taxes on the product (tax 1) then turns around and makes a profit by selling it (tax 2). Heck, why not add a user fee too? If you can get away with double taxation why not triple? Ontarians don't seem to mind.

Lastly, it's a gross conflict of interest. By selling and marketing alcohol the government is encouraging the consumption of alcohol which as the guardians of our health care system it absolutely should not be doing. On the contrary, it should be in the business of regulating alcohol use, not promoting it.

The LCBO is a cash cow that the government wants to preserve at all cost, whether it's right for the people of the province or not. We deserve better.

 

[TOareaFan]

It's called a monopoly. Monopolies create an artificial market that favours the monopolizer, infringing on the consumer's right to fair economic/market competition. This is not a good thing, whether you like alcohol or not.

What's more, this is a government monopoly (likely an anti-constitutional one), which means our government levies (high) taxes on the product (tax 1) then turns around and makes a profit by selling it (tax 2). Heck, why not add a user fee too? If you can get away with double taxation why not triple? Ontarians don't seem to mind.

Lastly, it's a gross conflict of interest. By selling and marketing alcohol the government is encouraging the consumption of alcohol which as the guardians of our health care system it absolutely should not be doing. On the contrary, it should be in the business of regulating alcohol use, not promoting it.

The LCBO is a cash cow that the government wants to preserve at all cost, whether it's right for the people of the province or not. We deserve better.

fair enough....you are opposed on philosophical terms.......assume that we privatize and that reduces, either, tax 1 or tax 2.....moving on to the next practical point....how does the province plug the revenue gap? or, alternatively, what provincial services are we willing to see cut?

 

[rbt]

but if we go back to your original comment that there be strict price controls based on retailing on a not for profit basis (ie. they would not be allowed to make any profit on the sale of booze) then I don't think they would be all that interested.....certainly not enough to pay for a license to sell the stuff.

I think you might be surprised. Yes, you won't get those depressing booze only retailers like you find in Alberta or various states, but I think you would find the local Loblaws, Longos, Metro, Sobeys would rapidly add a wine/beer section. Also a very good chance the local corner store would start carrying beer and a few wines as a chance to push their cheese and chips (which do have high markup).

I've been lead to believe (commercial real-estate agent) that LCBO often gets very favourable lease rates in the locations integrated with Loblaws stores.

If the alcohol is essentially revenue neutral, they'll do it just to keep their current customers from going to a competitor which did decide to offer that product line.

how, in that model, does the province fill the big income gap they would create for themselves?

That of course is the big question and requires more detail from LCBO finances than I have. Do they actually make significant money from retail or is it the fact that they supply restaurants/bars at similar pricing?

 

[Tewder]

fair enough....you are opposed on philosophical terms.......assume that we privatize and that reduces, either, tax 1 or tax 2.....moving on to the next practical point....how does the province plug the revenue gap? or, alternatively, what provincial services are we willing to see cut?

No, ethical terms. Very different!

As for revenue, it's not as though it would completely dry up. There would still be a tax on alcohol like there is on anything else. It's about stopping the gouging and opening the industry up to the free market, which would create all kinds of private business opportunities which would stimulate corporate tax revenues. The province would also be saving all the LCBO operating costs and payroll. It's not as if we're proposing something unheard of, Ontario's system is the aberration not the free market one.

 

[TOareaFan]

As for revenue, it's not as though it would completely dry up. There would still be a tax on alcohol like there is on anything else. It's about stopping the gouging

Sure, but in a province already struggling to fund its obligations and running a pretty large fiscal deficit even with all the revenue it gets from liquor sales (the tax and the markup) it is hard to see how we get rid of one part of that revenue and not face some sort of fiscal challenge.

and opening the industry up to the free market, which would create all kinds of private business opportunities which would stimulate corporate tax revenues. The province would also be saving all the LCBO operating costs and payroll. It's not as if we're proposing something unheard of, Ontario's system is the aberration not the free market one.

The operating costs of the LCBO are accounted for within the LCBO before the dividend to the province is calculated.....so there is no real savings there. (at the provincial coffers level).

Look I get it, there are people opposed to the way alcohol is sold....there are things within the provincial revenue streams that I am not a fan of either.....but if we are going to propose changes we need to be cognizant of the fact that this province has financial needs and if any part of the move to change the way we do things is to lower the cost to consumer that inherently means that there is money being taken out of the system to be left with the consumer...and that is fine...but there has to a recognition that this leads to, either, the province going deeper into debt (and we pretty much are at the deep end of that pool) or finding services that we can cut.

 

[DarnDirtyApe]

Cost savings could come from not paying workers $20-25 per hour to stock shelves and work cash registers or by using less workers overall to get the job done, but that's a whole other issue.

The LCBO also encourages wholesalers to INCREASE their prices (and thus reduce LCBO profits) as a way of discouraging consumption and giving a leg-up to Ontario wineries that have higher cost structures.

 

[TOareaFan]

The conversation may be moot anyways.

http://www.thestar.com/news/queensp...improving_lcbo_selling_smaller_utilities.html

A blue-ribbon panel on government assets is urging the expansion and modernization of the LCBO’s retail operations with big-box superstores, niche boutiques, and allowing the sale of 12-packs of beer.

TD Bank chair Ed Clark, Premier Kathleen Wynne’s privatization czar, also recommends selling off small utilities, including Hydro One Brampton, as part of a push to bring in billions to the cash-strapped treasury.

“You should not rush to sell assets — rushed sales are not in the public interest,” Clark told a luncheon speech Friday at the Metro Toronto Convention Centre.

And if you think their goal was to lower the cost of alcohol/wines

Clark said the LCBO, the government’s 639-store monopoly that brings in $1.74 billion annually to Queen’s Park on sales of almost $5 billion, could be far more profitable.

“We were troubled that the LCBO doesn’t use its buying power to lower costs — despite being one of the largest buyers of wine and liquor in the world,” he said.

So they should use their buying power to lower their costs....but not to pass on lower costs but to increase the profits reaped by the government.

AND:

Clark also advises closing loopholes that see outlets such as Wine Rack, which are privately owned by domestic wine producers, taxed at a lower rate.

“In effect, a bottle of wine sold through one of the wine stores yields less to the government than a bottle of wine sold through the LCBO.”