How the Brews Brothers out-sudsed the Kathleen Wynne Liberals

By Gerry Barker

Posted September 29, 2015

The Kathleen Wynne government has announcement that beer will be available in a selected group of Ontario supermarkets by Christmas. The details of this revolutionary decision shows that the beer distribution monopoly still exists in bluestocking Ontario.

Well, Zippidy Doo Dah.

Unless you’ve been vacationing on Mars, the sale of beer in Ontario is monopolized by the Brews Brothers, three foreign beer makers who own the Beer Stores in Ontario. And those stores showcase the owner’s products, Who are the Brews Brothers? They are Sapporo of Japan, AmBrew of Belgium and Molson Coors of the United States.

Here we have the province with the largest population in the country and it cannot afford to have free trade in the sale of beer. It’s ironic that the province already has a distribution system selling spirits and small packs of beer. It also has the legislative muscle to end the beer monopoly and open the market for price competition.

They chose not to.

So the Ontario consumer has to live with supply management including dairy products, pork, beef, poultry, electricity, liquor, water and now beer. All of these are controlled because the supplier, and not the market, fix prices.

In Ontario, the people are being taxed to death. Oops, the provincial government forces taxes on the dead including, probate taxes, tangible asset taxes, funeral expenses. Estate representative have just 90 days to report the value of the decease’s stuff or face fines. That’s another Wynne govermnet amendment to increase revenue. Then the Canada Review agency gets a bite if the estate has any capital gains of investments owned by the deceased.

With all that tax money flowing into the provincial treasury why is it that the provincial government, headed by Premier Wynne, cannot balance its books? With a $10 billion deficit in 2014 that has been around from McGuinty forward, was the beer monopoly so important to be maintained in perpetuity?

In a new ten-year agreement with the Brews Brothers, the Kathleen Wynne Liberals have virtually guaranteed price fixing of the popular product. The only concession the Brews Brothers allowed was the sale of beer to the supermarkets. But the supermarkets can only sell six packs, same as the LCBO. The supply is rationed and the price fixed. If supermarket A exceeds its allotment, it will face fines.

Left out of this 18th century-like deal, is the public who drink beer. The price gouging that exists in the sale of beer in Ontario is an affront to consumers. There is no competition to maintain a level playing field for beer consumers. That’s the fixed price, either pay it or cross the border to Quebec, New York or Michigan when beer is sold everywhere and the price is much lower than in Ontario.

This was a monumental con job by the Brews Brothers who own more than 400 Beer Stores in Ontario. Those stores supply beer to the entire province because they can sell any amount of beer, whether it is in bottles, cans or kegs. They also are appointed as distributors to all hospitality venues in the province including restaurants, bars, hotels, and clubs. Any place where beer is sold for on site personal consumption.

If that isn’t the perfect monopoly, then I’m Donald Trump

This was a capitulation by the Wynne Liberals who disregarded consumers by allowing the price of beer to be controlled by foreign entities.

But why be surprised? The Wynne government is unable to control the price of electricity, settle labour contracts with its staff and is at war with the teachers.

The 444 Ontario municipalities are hamstrung by dated regulations and policies that strangle the opportunities available to grow. Municipalities must balance their books annually.

Why can’t the province do the same?

The municipalities chief revenue come from property taxes and they are not allowed to introduce any tax plans to enhance their community.

The Wynne Liberals keep moving the deficit ball forward. The latest is Finance Minister Sousa says the provincial budget will be balanced by September 2018, coincidently just prior to the next provincial election. His previous claim was the books would be balanced in 2017.

Who knows? By that time, a case of beer will probably cost more than $60.

Retired newspaper executive, Gerry Barker is the editor of guelphspeaks.ca, a blog commenting on community, provincial and national affairs. He may be reached at: gerrybarker76@gmail.com

 

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