Doug Ford says he won’t be selling or privatizing the LCBO.

Then he better damn well fix it.

“I’m going to make two things very, very clear,” Ford said Wednesday. “We’re not privatizing the LCBO. We’re not selling the LCBO.”

The problems with the Liquor Control Board of Ontario are on full display because of the strike by retail workers. The union representing frontline workers says they want to stop the province from selling ready-to-drink beverages like a White Claw, Vizzy or hard seltzer in grocery and convenience stores.

“Let me be very clear: it’s done, it’s gone, that ship has sailed and it’s halfway across Lake Ontario,” the premier said about expanding access using a classic Fordism.

So, if privatization is off the table, if selling the LCBO is off the table, then how about fixing the thing. Which strangely, has very little to do with the union and their contract and more to do with bloated management, predatory policies and a corporate culture that puts the consumer last.

One thing LCBO management and their union partners at OPSEU agree on is that the $2.5-billion annual dividend the LCBO provides to the province is useful and beneficial. Perhaps, except that the LCBO provides the second lowest return per capita of any provincial liquor regulator, according to Stats Canada.

In Newfoundland and Labrador, their liquor agency returns $358 per capita to the provincial treasury, the highest in the country. The lowest in the country is Prince Edward Island at $146 per capita.

Ontario is second to last at $159.

Per capita return of provincial liquor authorities.
Ontario is second to last in returns to the provincial treasury in liquor sales.

Now, let’s compare Ontario to Alberta, a completely private system with lower taxes, lower prices for most products, real sales, better selection and a return of $178 per person. If Ontario saw Alberta’s rate of return per capita we’d have close to an extra $300 million in the provincial coffers.

We don’t want to follow the high tax jurisdictions but surely there is something to learned from Alberta, even if Ford rejects the privatization model for sales.

The LCBO is often touted as the biggest purchaser of beverage alcohol in the world. That should mean that they could leverage that buying power to get consumers better prices, but they don’t. We face higher prices.

Meanwhile, they tell suppliers they need to provide the lowest possible price and then they stick it to the consumers in the store. As was recently reported, the LCBO imposed clawbacks on distillers claiming they had offered lower prices to other government monopolies in Canada.

The LCBO used predatory practices to force some distillers to admit to offering lower prices and with others just estimated that the wholesale price must be lower. These are bully tactics, predatory practices and not something you would expect from a government entity which should be operating above board.

If Ford won’t scrap the LCBO then he needs to look at major reforms to an organization that throws its weight around for the benefit of those at the top of the organization – CEO George Soleas and his multitude of executives — rather than the people who own the LCBO and whom they should be serving.

The LCBO was set up when Ontario was leaving prohibition in 1927, it is not a modern alcohol retailing system. While the stores are pretty, their business practices are ugly and as the only legal shareholder it is up to the Ford government to fix this.

Please, Premier Ford, if you won’t look at privatization, then look to clean up the back offices and the executive suite at the LCBO.

RECOMMENDED VIDEO