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Politics Ontario Liberals push forward with plan to sell liquor in grocery stores

The Mac's Convenience store in Thamesford, Ont. is one of the few convenience stores allowed to sell alcohol. Open from 7 am till 11pm, the store sees shoppers from workers at nearby factories and from people in nearby London, Ont. when LCBO outlets are closed on statutory holidays.

Fred Lum/The Globe and Mail

The Ontario government is pushing ahead with a plan to put liquor kiosks in grocery stores, a bid to shake up the way alcohol is sold in the province and head off the champions of privatization ahead of a possible spring election.

The Liberals' move also comes as the party casts about for any good news amid the gas-plant scandal, in which Premier Kathleen Wynne looks set for a legal showdown with Progressive Conservative Leader Tim Hudak and new revelations that the boyfriend of a Grit staffer was hired as an IT expert on the taxpayers' dime.

Finance Minister Charles Sousa is expected to unveil a request for proposals Tuesday that will ask grocery stores to sign up to have an LCBO Express store placed in them, a government source said. The government will then select a handful of stores to receive the kiosks.

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The tentative step toward liberalizing liquor sales does not go as far as Quebec, which has long allowed beer and wine to be sold in grocery and convenience stores.

Alberta has an entirely privatized liquor retail system and British Columbia, which has a hybrid model, is set to allow liquor in grocery stores in the near future.

The idea, first announced in 2012, follows several similar moves from the LCBO, which has in recent years put liquor stores adjacent to supermarkets. This, however, would be another step at mixing the government liquor monopoly with private retail. The kiosks will still be owned and run by the LCBO, but will occupy space in the middle of grocery stores.

Mr. Hudak's Tories have stirred the age-old privatization debate over the past year, putting out a policy paper that envisages selling off all or part of the LCBO. Proponents of privatization argue that introducing competition into the market would lead to more liquor stores, better selection and service. Alberta, for instance, has more than 1,100 liquor stores, only slightly fewer than the combined total of LCBOs and Beer Stores, in a province less than a third the size of Ontario. Unlike the LCBO, many of the prairie province's liquor stores keep late hours.

The Liberals have repeatedly vowed not to privatize liquor sales – in large part because of the money the LCBO funnels into government coffers.

With the Grits holding only a minority of seats in the legislature, they must secure the support of at least one other party to pass a budget and avoid a spring election. In the event of a vote, the promise of more accessible liquor may be a method to deflect the Tories' privatization promises.

The kiosk announcement is also coming down unexpectedly after several days that saw Queen's Park dominated by explosive developments in the gas-plant scandal. Last week, an unsealed police document revealed that investigators believe former premier Dalton McGuinty's chief of staff brought in outside IT expert Peter Faist to "wipe" clean government computers.

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On Monday, the government revealed that Mr. Faist's company was paid $159,727 to work for the Liberal caucus office from June, 2010, to January, 2013, and held a further contract for the Liberal Party until last weekend. Mr. Faist is the boyfriend of former McGuinty staffer Laura Miller.

Ms. Wynne, for her part, had her lawyer send Mr. Hudak a "cease-and-desist" letter, after he accused her of overseeing the deletion of documents. Ms. Wynne says Mr. Faist never entered the premier's office after she took over from Mr. McGuinty.

The tense mood in the provincial government has only stoked speculation about a spring election, leaving the Grits well aware of the need to be prepared.

The LCBO has long faced privatization calls, but has steadily beaten them back by improving customer service and holding the line on prices.

With a report from Adam Radwanski

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