OPSEU/SEFPO President Warren (Smokey) Thomas sent the following letter to Peter Bethlenfalvy, Minister of Finance calling for him to support the LCBO by rejecting lobbyists’ efforts to push for private expansion.
July 13, 2021
Hon. Peter Bethlenfalvy
Minister of Finance
99 Wellesley St. W, Room 4320
Toronto, ON M7A 1W3
Re: rejecting private expansion and supporting the LCBO
Dear Minister Bethlenfalvy:
As you know, the Liquor Control Board of Ontario (LCBO) is a Crown jewel of a corporation, bringing in more than two billion dollars in revenue for the province annually. But the success of the LCBO model is being threatened by the expansion of privately-operated Convenience Outlets (LCOs). I am writing to express my concern about lobbyists’ efforts to push this expansion, especially in urban areas.
In recent years, there has been a proliferation of LCOs in Ontario. In fact, we’ve seen a 76 per cent increase year over year. As privately-operated businesses, their profits line the pockets of their private owners, instead of going back to the people of Ontario to help pay for much needed public services. Since LCOs get a 10 per cent discount on the wholesale price of alcohol, their profits represent a 10 per cent loss for the public coffers.
Yet, they continue to demand more of the public pie. Now, the Ontario Convenience Stores Association (OCSA) has announced its interest in meeting with LCBO management to push the idea of expanding the LCO model even further, and to include urban expansion. I am writing to ask that you intervene by directing LCBO management to reject this dangerous course of action. The location of LCOs is carefully selected by the LCBO to ensure they are not in urban areas or within 5 kilometres of an existing LCBO store or Beer Store – and for good reason.
The expansion of LCOs does not only represent a loss to our public coffers, but poses a threat to our public health and safety. It harms our communities and threatens the very livelihood of front-line LCBO workers. Since 2015, the number of retail outlets selling alcohol in Ontario has increased by more than 40 per cent. In 2019/20 alone, there were 160 new LCOs established, and only three new LCBOs.
This expansion has already been too costly. It has harmed the LCBO, and in particular, the small and rural store locations. In 2019, significant change were made to facilitate the rebranding of agency stores as LCOs, including changes to the delivery structure. Now, instead of picking up their products from the nearest LCBO store – or supplying store – products are delivered directly to these LCOs, and they are charged directly for delivery fees. This entire structure has affected sales figures for LCBO stores that were formerly supplying stores, resulting in staffing hours for casuals being cut.
It’s time to stop the sell-off of our publicly-run LCBO. It’s time to eliminate the direct delivery model, and to ensure that LCBO products are delivered on LCBO-contracted trucks to LCBO supplying stores.
Moving forward, we kindly request that you pause any talks on expansion and undertake a comprehensive review of its impact on public health and community safety before proceeding. We’re confident that you’ll find the costs and risks outweigh any benefit of so-called ‘convenience.’
Warren (Smokey) Thomas
Ontario Public Service Employees Union (OPSEU/SEFPO)