Canada: Public liquor retail system is better, both economically and socially
Published on Wed, 2012-10-31 13:19
The province of Saskatchewan’s public liquor retail system is superior to both Alberta and British Columbia’s private scheme in terms of price, revenue generation and mitigation of social harm, concluded in a new report the Saskatchewan office of the Canadian Centre for Policy Alternatives (CCPA, one of the focal points of Social Watch in that North American country) and the Parkland Institute.
The study titled “Impaired Judgement: The Economic and Social Consequences of Liquor Privatization in Western Canada”, authored by University of Alberta public finance economist Greg Flanagan and Parkland Public Policy Research Manager David Campanella, compares the liquor systems in Saskatchewan, Alberta and British Columbia.
The authors concluded that the full privatization of liquor stores in Alberta and the partial privatization in British Columbia have resulted in higher prices, lower revenues for the government and increased social harms in comparison to Saskatchewan’s public system. Some of the highlights of the report include:
■ In a price comparison of beer, wine and spirits in the three provinces, BC’s private stores had the highest price on 11 of 13 products surveyed, while Alberta’s private stores were the second costliest. Saskatchewan and British Columbia’s public stores had the lowest prices among the 13 products surveyed.
■ Since the establishment of the private system, Alberta has forgone nearly $1.5 billion in tax revenue. In contrast Saskatchewan’s per capita liquor revenue has increased over the same period.
■ Public stores consistently demonstrate higher compliance rates than private stores in regards to sales to minors or intoxicated patrons. In BC, public stores had an average compliance rate of 70% compared to only 35% for private stores.
■ After the 1993 privatization of the liquor sale system in Alberta, Edmonton police reported double the amount of offences for minors in possession of alcohol.
■ A public monopoly allows communities to control the density of liquor stores in their neighborhoods. In contrast, liquor store density in BC after partial privatization increased 56.83%, while density in Alberta increased 72.18% post-privatization. In contrast, Saskatchewan’s liquor store density has actually decreased 11.10% in the past decade.
■ A public monopoly also allows a greater regulation of low-price, high alcohol-content products marketed to youth.
■ A 2011 study by the Centre for Addictions Research for British Columbia, University of Victoria, found that each additional private liquor store per 1,000 residents 15 years and older increased local alcohol mortality by 27.5 per cent in B.C. between 2003 and 2008.
In Alberta and British Columbia, liquor retail privatization has meant high liquor prices but low government revenue. Further, the increased availability of alcohol and its lax regulation contravene recognized methods for protecting public health.
In light of Premier Brad Wall’s comments on moving Saskatchewan to a hybrid private/public model along the lines of British Columbia, these social and economic consequences of liquor privatization must be front and centre in any debate over the future of public liquor delivery in Saskatchewan.