Should the sale of alcohol in Ontario be privatized?

Alcohol should be sold in convenience stores

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Madison McSweeney | Fulcrum Staff

Expanding alcohol sales into convenience stores will give consumers more choice and stimulate the economy.

Mac’s Convenience Stores recently pledged to build 27 more stores in Ontario if the government allows them to sell alcohol, which would create 170 full-time jobs. More than 1,000 additional jobs and millions of dollars in investments would also be added to current stores.

Increased alcohol sales will also contribute substantial returns to the Ontario government. In 2012-13, the provincial government received $791 million in tax revenue alone from the 634 LCBO stores and 219 agency stores in the province. If alcohol sales are opened up to the 10,000 convenience stores operating in Ontario, there will likely be a significant increase in tax revenue.

The main argument of those who oppose alcohol in convenience stores is that the LCBO transferred $1.7 billion to the Ontario government in 2012-13, plus taxes. But no one is advocating for the privatization of the LCBO. Mac’s Convenience Stores vice-president Tom Moher even told the Globe and Mail that there is room for both outlets to sell alcohol.

There is no evidence to back up claims that convenience store clerks will be more inclined to sell alcohol to minors than LCBO employees. Although some argue that convenience stores will be more lenient regarding alcohol sales in order to increase profits, the opposite is likely true. With the possibility of a $500,000 fine, it is not in the financial interests of a business to violate liquor laws. Convenience stores already sell cigarettes and lottery tickets and follow strict guidelines for these products. In fact, a Statopex Field Marketing study found that convenience stores were 12.7 per cent better at denying sales to minors than the LCBO.

With the practical arguments debunked, the only remaining objection is a moral one. But the government can only go so far in protecting people from themselves. Unfortunately, there will always be people who become addicted to alcohol, just as there will be those who are addicted to gambling, eating, and other compulsive habits. Expanded alcohol sales will not change this, nor will government monopolies prevent alcoholics from obtaining addictive substances.

The majority of Ontarians drink responsibly, and objections to convenient access to alcohol are outdated and paternalistic. Adults have the freedom to make their own decisions.

Dangers of privatization outweigh the benefits

Nadia Drissi El-Bouzaidi | Fulcrum Contributor

Those in favour of alcohol privatization often argue that it would lower prices and be more convenient for consumers. But when you critically examine these claims, the benefits of privatization become much hazier.

Proponents of privatization argue that it would increase competition and lower prices. However, the LCBO’s high prices are due to alcohol’s elevated taxes. These taxes would still apply to anything you buy at Mac’s.

The high taxes of potentially harmful substances, such as tobacco and alcohol, are meant to reduce excessive consumption while also generating large profits for the government. A dramatic change in prices could have a negative effect on the population.

According to a joint letter sent to the Canadian government by Mothers Against Drunk Driving (MADD) and the Centre for Addiction and Mental Health (CAMH), alcohol is responsible for the highest rate of death and disease among substances in Canada.

It can’t be ignored that the LCBO also earned approximately $1.6 billion for the government of Ontario, not including taxes. This money is channelled into numerous government agencies and has helped reduce Ontario’s $11.7 billion deficit. However, many argue that the later hours of convenience stores and the increased accessibility of alcohol would help increase revenue because there would be more people buying alcohol. The influx of people buying alcohol at later hours and at establishments not as secure as the LCBO could put the lives of employees in danger.

The best solution would be for the LCBO to extend its hours of operation and lower its prices, ultimately increasing revenue. Both factors are closely associated with the positive aspects of privatization, but the government of Ontario can achieve them without including the dangers of privatization. Over the next three years, the LCBO plans on having 34 new stores, in addition to 10 new express stores located in or around large grocery stores.

Those arguing in favour of privatization should remember, as the letter from MADD and the CAMH suggests, that alcohol is not a normal commodity and should not be treated as one.