LILLEY: Here's the facts on the LCBO's $2.5-billion dividend

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Can we all stop acting as if Ontario’s health-care and education systems will suffer if the government doesn’t directly sell us alcohol in this province?

The strike at the Liquor Control Board of Ontario’s retail outlets has led to a discussion about the future of the organization. The union representing the striking workers is claiming, falsely, that they provide funds for vital public services and selling alcohol elsewhere will send that money into private hands.

“We’ve been very clear that we won’t back down in our fight for a strong future for the LCBO and the public services funded by LCBO revenues,” said Colleen MacLeod, chair of the OPSEU bargaining unit as the strike began.

MacLeod wants the public to believe that without her union members selling you that bottle of wine or can of seltzer, health care and education in Ontario will suffer. It’s simply not true, a fact that we can see from comparing Ontario to other provinces.

Alberta turned from government-run liquor stores to private liquor stores more than 30 years ago. Yet, despite having a fully private retailing system, their provincial liquor regulator returns a larger dividend per capita to the provincial treasury than the LCBO does.

Statistics Canada tracks the annual net income of liquor authorities in Canada and for fiscal year 2022-23, Alberta returned $825,104,000 to the provincial coffers. With a population of 4,645,229 as of April 1, 2023, that means the Alberta Gaming, Liquor and Cannabis Commission gave the government a per capita return of $177.62.

That same year, the LCBO’s net income from liquor was $2,457,527,000. With a population of 15,457,075 as of April 1, 2023, the LCBO returned $158.99 per capita. Even using the $2.58 billion the LCBO remits, which includes other earnings, the LCBO’s per capita return to the province would be $166.91, which is still lower than Alberta’s return.

If Ontario had Alberta’s per capita dividend, then the LCBO would have handed over $2.7. billion just from liquor sales, plus the extra money from other revenue sources.

The money that the LCBO returns to the province isn’t a profit from running the retail stores, it is a combination of taxes and fees charged on the products bought, warehoused, distributed, and sold via the LCBO.

As Alberta shows, that revenue can continue to flow even with a fully private system.

Now, is this strike about privatization?

Only to the union.

The Ford government has made clear that they have no intention of selling off the LCBO or moving to a fully private retail model. They are already undergoing the most substantial changes to alcohol sales and distribution in more than a century and are in the middle of reviewing taxes, fees and regulations for industry.

Their plan was to continue with the current LCBO model but expand points of sale to more convenience and grocery stores. The LCBO union opposes this change, even though most Ontario residents support it.

If anything pushes a wider and full privatization it will be the strike. If and when that happens, Ontario residents deserve to know the truth.

That $2.5 billion would still be available to fund provincial programs regardless of who is selling you booze. In fact, based on the Alberta model, the province might even make more money under that system.

Even as Ontario has expanded alcohol sales to locations outside of the LCBO over the past several years, the dividend the LCBO returns has increased.

In 2016-17, the first year of full expansion into grocery stores by the former Kathleen Wynne government, the dividend paid to the Ontario treasury was $1.98 billion. Last year the amount was $2.58 billion, which is not only a larger figure, it also beats the rate of inflation according to the Bank of Canada Inflation Calculator.

It’s fair to debate the future of alcohol sales in Ontario, it’s fair to argue for keeping or scrapping the LBCO, but let’s do it using facts, not fear mongering from the union.

blilley@postmedia.com