Wednesday May 22, 2013


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  • QUESTION OF THE WEEK

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    Liquor sell-off a fast cash grab

    The union representing B.C. government employees is raising the spectre of the failed Coquihalla highway privatization as the province attempts to sell liquor wholesaling and distribution.

    Aside from the fact the B.C. Liberal government is unlikely one day to make booze free — as it did travel on the Coquihalla highway — it is a valid comparison.

    The highway, like sale of booze in B.C., brought revenue to the province, albeit on a much smaller scale.

    Then-premier Gordon Campbell decided shortly after taking power in 2001 that the province couldn’t afford to borrow the billions it needed to improve infrastructure, primarily upgraded highways.

    It would sell the Coquihalla highway and its tolls to bring in a one-time bonus to the treasury, as much as $1 billion.

    A year later, after fierce public opposition, Campbell backed down. Five years after that he decided that B.C. was so wealthy it no longer needed the $50 million or so annually that tolls brought in. The toll booth was removed.

    Fast forward to February this year, when Finance Minister Kevin Falcon declared the province would put wholesaling and warehousing of booze, currently done out of government-owned operations in Vancouver and Kamloops, up for sale.

    Now, apparently, government needs a one-time cash infusion — easy money at no cost.

    It has not provided any business case for the sale, which on the surface makes little economic sense.

    B.C. has a mixed model of private and government liquor sales. B.C. Liquor Distribution Board is one of the largest buyers in the world and is able to demand price and variety for consumers. It also sells booze for one price out of its stores, whether in Vancouver, Vanderhoof or Atlin.

    Government sets the price and controls the profits — unlike any other product. Private industry was not clamouring for the move. It was surprised.

    Six companies have now expressed interest in the service. By a letter of understanding, employees must go to any winning bidder at current salary and benefits. Jobs are not bound to Kamloops, however.

    The longer the process drags, the less the sale would seem likely.

    Voters will go to the polls next May. Selling a government asset with recognized value long-term in return for a quick fix to the treasury is not a winning idea.

    This plan should be shelved before there is significant investment into a business plan by would-be buyers. Government has never made a winning case for any privatization of its liquor business, this one included.


    We Say editorials represent the viewpoint of The Daily News and are written by editor Robert Koopmans, city editor Tracy Gilchrist, news editor Mike Cornell or associate news editors Dan Spark and Mark Rogers.

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