High Prices at SAQs Drive Debate Over Privatization

High Prices at SAQs Drive Debate Over Privatization

By Mitch Vandenborn

Throughout 2014, there have been grumblings from citizens and business leaders who are dissatisfied with the high prices of wine, liquor and spirits at the provinces’ Société des alcools du Québec (SAQ).

Some have called for the system to be abolished, while others say that it’s business model needs to be reworked.

In August, a Leger poll conducted for Le Devoir found that 42 per cent of people in Quebec would be in favour of privatizing the SAQ.

However, the SAQ remains a significant cash generator for the provincial government, accounting for over $1 billion in revenue in 2013.

With Quebec’s deep public debt, saying goodbye to that money could prove difficult.

Earlier this fall, the Fédération des chambres de commerce du Québec argued at the government’s Ongoing Program Review Committee that the SAQ’s monopoly on liquor sales should be phased out.

In its place, they suggested a system of wholesaling where the SAQ would be the bulk purchaser of alcohol before distributing to the private sellers.

That way, they argued, the provincial government could still receive revenue from the sale of alcohol, but increased competition would lead to better prices for consumers.

In more of a direct-action approach, a group of over 250 people dissatisfied with the status quo took five buses from Quebec City to Ottawa early on a Saturday morning earlier this month to protest high prices in Quebec.

Organized by popular local radio host Sylvain Bouchard, the protesters travelled to Ottawa and converged on a large downtown location of the Liquor Control Board of Ontario (LCBO), Ontario’s province-run liquor store, where prices of wine can be significantly cheaper than in Quebec.

That same weekend the union representing SAQ employee, the Confederation des Syndicats Nationaux (CSN), released a 14-minute video comparing prices and level of service in Quebec to stores in Alberta, where liquor sales are privatized.

Backlash to the video was swift because of a racist comment made by a supposed customer in the video, saying that it is impossible to get wine advice in the province because the employees are frequently, “an Indian, a Pakistani, who doesn’t know wine and doesn’t even drink wine.”

The CSN later apologized and re-released the video with the comment edited out.

Similar discussions about what to do with the province-owned liquor business have been playing out in neighbouring Ontario, due to similar complaints about a lack of competition leading to high prices.

In October, TD Canada Trust CEO Ed Clark delivered a report from the Advisory Council on Government Assets that recommended against the privatization of the LCBO.

“We couldn’t see how the consumer would be better off,” he said. “And it is possible that the consumer could be worse off unless you developed a strong regulatory system.”

In April of this year, Quebec Premier Philippe Couillard said nothing is off the table when it comes to figuring out how to solve the province’s debt issues, including selling off provincially-run assets.

The comment came after a report by two Quebec economists, Luc Godbout and Claude Montmarquette, suggested a partial sell-off of the SAQ and Hydro-Québec as a way to help pay off the province’s debt.

Although the SAQ has announced plans to better serve customers, including a renewed focus online and free home delivery if the order is over $75, time will tell if those changes will quiet the discontented.

Categories: Opinion

About Author

Mitch Vandenborn

Originally from southern Ontario, Mitch Vandenborn moved to Quebec City in September 2014 to improve his French. It's still a work in a progress. Mitch studied journalism at Carleton University, Ottawa and has worked in writing and communications for several years. He's also a frequent Tweeter: @mitchvandy

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