Here's to beer sales we can all cheers to

Author: Paige MacPherson 2019/06/13

This column was published in the New Brunswick Telegraph-Journal on June 13, 2019.

New Brunswickers can cheers to the fact that they’ll soon be able to make one stop instead of two on their way home, with the newly minted permission to buy beer in grocery stores. To truly expand consumer choice and maximize job creation, the New Brunswick government shouldn’t be in the business of selling beer, wine or liquor at all.

Expanding beer sales to grocery stores is a step in the right direction – one Quebec and Ontario have already made (similarly, Newfoundlanders and Labradorians can buy beer at gas stations while filling up). But it still doesn’t feel quite right that the government must grant adults permission as to where they can purchase beer or wine.

The revenues generated by NB Liquor makes it more difficult for the government to cut it loose. But if we focus solely on this revenue number, we’ll miss the forest for the trees.

As noted in the Telegraph-Journal, NB Liquor is set to bring in $168 million for the provincial government per this year’s budget. But the abject failure of NB Cannabis – losing $11.7 million in its first six months – brought into question whether government is the best retailer to begin with. 

After all, it seems pretty difficult to lose money selling pot to Canadians. But, roll retail sales up with a crown corporation and government bureaucracy, and they’ll find a way. Even a Tim Horton’s in a St. John’s hospital lost money when it was run by the government (about $260,000 per year – what the average Tim Horton’s collects in profits).

The significant losses faced by NB Cannabis represented a hit to parent company NB Liquor. Both Finance Minister Ernie Steeves and Premier Blaine Higgs have said they’re exploring options, including privatizing pot sales, to stop losing tax dollars.

In the meantime, it has been reported that NB Liquor executives and employees received more than $400,000 in extra bonuses in 2018 due to accounting changes, not improved performance. This brought their yearly bonus total just shy of $1 million. Two days later, Minister Steeves ordered a financial review of NB Liquor.

These losses and overspending simply aren’t necessary.

Unquestionably, New Brunswick needs a steady stream of tax revenue to provide services, lower taxes and dig the province out of debt. And New Brunswick needs jobs.

Opening up beer, wine and liquor sales as other provinces have done – allowing entrepreneurs to open their own stores – could generate new, better jobs creating multiple streams of income, business, property and sales tax revenue to various levels of government.

Alberta stopped selling alcohol in government stores more than 20 years ago. Since then, that province has brought in billions in taxes from beer, wine and spirits.

Since beer and liquor sales were privatized, the number of stores in Alberta grew from 202 in 1993 to nearly 2,000 stores in 2013. The number of employees in beer and liquor sales over that same period grew from 1,300 to about 4,000.    

On top of this, consumers have the ability to stock up for their kitchen parties at a variety of stores which compete with one another by offering wider product selections and deeper discounts.

It’s not just Alberta. Residents of BC, Saskatchewan and Manitoba can all buy their beer, wine liquor at both private and government stores.

New Brunswick is on the right track, but the government should hit fast forward. Freeing up beer, wine and liquor sales in New Brunswick would create significant opportunity for new jobs and new revenues – and would simply give adult consumers more choices. We can drink to that.

Paige MacPherson is Atlantic Director of the Canadian Taxpayers Federation.

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