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For those Ontarians excited about the potential of beer coming to a corner store near you, we are going to have to be the bearers of bad news.
Although Premier Ford will be working to fulfill his promise to introduce beer sales to corner stores, the former Wynne government decided that beer sales were to be exclusive to The Beer Store. In 2015, the Liberals put into place a contract between The Beer Store, three major breweries, and the province that does not end until 2025.
The contract limits the number and type of retail outlets that are able to sell beer in Ontario. Of course, allowing 11,000 convenience stores to sell beer would be in a direct breach of the contract, with any of the contract’s key terms being subject to heavy penalties.
When Kathleen Wynne announced that large-chain grocery stores would be able to sell alcohol, she proudly announced that “the monopoly is over.” But as we now see, it’s anything but over, and appears to still be in full swing.
Premier Ford’s campaign promise to put beer into corner stores may be over before it ever started, but who is to blame for it? Though breaking a campaign promise is never something to turn a blind eye to, it’s important to look past the surface and assess why there would be a problem putting beer into corner stores in the first place.
Although Wynne was the premier that brought beer and wine to large grocery stores, she was no fan of Ford’s plan to bring adult beverages to corner stores, saying that it would be a big step backwards, going so far as to say that the Ford government would want to sell marijuana alongside alcohol.
“You could have a situation where you have marijuana and beer and wine beside the candy bars,” Wynne said. “That’s the image we have to reconcile.”
The beer war of Ontario rages on
The contract was signed in 2015, and a close look at the publicly available document reveals ironclad provisions that stop the government from legislating their way out of the deal without massive compensations to The Beer Store and the breweries.
The contract gives The Beer Store and the brewers the right to monetary awards, even if the deal is breached because of legislation changes. In layman’s terms, there is no wiggle room for the Ford government to work within.
According to the document, compensations must be awarded “regardless of the status of the province as the Crown.” meaning that the government could not exempt itself from liability
Though the document does not specifically reveal how much money would be awarded in a contract breach, estimates ballpark at $100 million, which would of course, come from the taxpayer wallet.
Those aren’t the only issues with Premier Ford’s promise. The brewers could also argue that the added responsibility of distributing beer to an additional 11,000 locations is the responsibility of the province, as well as compensating The Beer Store for severance pay of over 7000 staff, as well as any fees to terminate leases on the stores it’s forced to close.
Province to give it a shot
Finance Minister Vic Fedeli said in an interview Wednesday at Queen’s Park that the province is going to continue to consult with the beer industries over course of the summer.
“I think the premier was pretty clear during the election and since that we want to put beer and wine in corner stores, big box stores, and more grocery stores because we want to offer people more choice and convenience.”
When asked if the contract would be worth the financial strain to the tunes of a hundred million dollars, Fedeli replied “Well, we don’t make any presumptions.
How incredibly Ontarian is this story? The tune of big government making our lives more difficult is an old and tired one we are all growing weary of. The bureaucracy has been built up to the point where any kind of disruption is impossible. Through contracts and red tape, our same-old ways will probably stay the way they are, at least until the contract ends in 2025.
What do you think of the provincial beer war? Let us know in the comments below.