A new report claims private liquor stores in Western Canada have higher prices than publicly owned stores, while also pouring less revenue into government coffers.
The Canadian Centre for Policy Alternatives and the Parkland Institute released a report Tuesday on liquor privatization in Western Canada and suggested it would be foolhardy for Saskatchewan to follow Alberta or British Columbia’s lead to privatize liquor stores.
“A common lure behind liquor privatization is a promise of cheaper alcohol,” report co-author David Campanella of the Parkland Institute said at a news conference in Regina.
“Our research, as well as other studies, found this to be a false promise.”
Mr. Campanella said the left-of-centre groups compared 13 popular beverages and found private stores in Alberta and B.C. averaged the highest prices. It was, “perhaps surprisingly to some,” public stores in Saskatchewan and B.C. that had the lowest prices on nearly all of the items, he said.
Mr. Campanella said privatization has also been particularly costly to Albertans.
“By not maintaining its pre-privatization level of tax revenue per litre of alcohol sold, the government has foregone roughly $1.5-billion in liquor revenue since 1993,” he said.
Mr. Campanella said in 2011, Alberta had the highest per capita consumption and the lowest per capita revenue from liquor stores. In contrast, Saskatchewan earns nearly the same revenue per litre of alcohol sold as British Columbia, which is much more densely populated, he said.
“In general, the liquor industry is not a money maker for governments,” he said.
The report also says that from the beginning of British Columbia’s privatization initiative, the government found “serious compliance problems” at the private stores when it came to selling alcohol to minors.
Alberta privatized liquor stores in 1993, while B.C. curbed expansion of publicly owned stores and started to allow private ones in 2003.
Saskatchewan Premier Brad Wall hinted last week that all new liquor stores in the province could be privatized.
The premier said additional liquor stores are likely to be needed in larger cities because of population growth. He questioned whether taxpayer money should be spent on building those stores when investment is needed in health care, education and infrastructure.
But Mr. Wall also insisted that existing provincially owned liquor stores would not be privatized.
Mr. Campanella suggested Saskatchewan would be wise to think twice before making the move.
“Our research should give any jurisdiction considering privatizing their liquor retail system reason to pause,” he said.
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