Selling legalized marijuana through LCBO ‘makes a lot of sense,’ Wynne says

theglobeandmail.com
Dec. 14, 2015
By Adrian Morrow

Ontarians may soon be buying weed alongside their whisky at government-owned liquor stores.

Premier Kathleen Wynne on Monday called for marijuana to be retailed though the LCBO when Prime Minister Justin Trudeau legalizes the drug. She contended that the tightly controlled monopoly would do the best job of making sure marijuana is sold responsibly.

“It makes sense to me that the liquor distribution mechanism that we have in place, the LCBO, is very well-suited to putting in place the social-responsibility aspect that would have to be in place,” Ms. Wynne said at Queen’s Park.

“Obviously, I don’t know what the timeline is at the federal government. But it seems to me that using that distribution network at the LCBO - as has been talked about in other provinces, using their provincial liquor distributions - I think that makes a lot of sense,” she added.

Selling pot and Pilsner under one roof could also provide a lucrative new source of revenue for the cash-strapped province, which collected a $1.8-billion profit off the Liquor Control Board of Ontario last year. One estimate, by Dundee Capital Markets, pegs the potential size of Canada’s future legalized recreational marijuana market at $5-billion.

Mr. Trudeau has embraced legalization for more than two years, and his government’s first Throne Speech earlier this month confirmed he will move forward with the policy. But the details have yet to be worked out.

“The legalization and regulation of marijuana is a commitment for this government – it is one of the priorities that was set out for the ministers of Justice, Health and Public Safety in their mandate letters,” Justice Canada spokesman Ian McLeod told The Globe and Mail on Monday. “That said, it would be premature to speculate on the specifics or timing at this point.”

Ontario isn’t the only province where liquor stores are in line to get a slice of the marijuana market. Manitoba Premier Greg Selinger said last month he would like to see marijuana sold by government Liquor Mart outlets. And the union representing workers in British Columbia’s government liquor stores has teamed up with the industry association for the province’s private liquor retailers to lobby for the right to sell the drug.

The Ontario Public Service Employees Union, which represents LCBO employees, called last month for marijuana to be sold at the Crown corporation’s outlets. OPSEU president Warren (Smokey) Thomas touted the LCBO’s “secure warehouses and distribution system” as well suited to handle pot. “All the infrastructure is in place for a smooth transition to a safer system,” he said in a statement.

Mark Zekulin, president of Tweed Marijuana Inc., which grows and supplies medicinal marijuana, said there is merit in selling through the LCBO. Such a system could enforce controls on quality and safety, as Health Canada currently does for medical marijuana, he said. Mr. Zekulin said he was not aware of any jurisdiction that has such a large-scale government distribution system for recreational marijuana.

“There’s nowhere to look to as a clear model to follow. It’s a great opportunity for Canada to build a robust system that other jurisdictions can look to for quality of production and security of distribution,” he said in an interview. “There is more value to moving prudently and cautiously.”

Mr. Zekulin said he would like to see a “phased approach” to legalization, where the federal government would start by allowing recreational users to buy their marijuana online from growers such as Tweed, as medicinal users currently do. This would give Ottawa more time to work out further details of the retail system with the provinces.

The LCBO said Monday it is waiting to see what the federal government does, and what the province’s orders are, before making any plans to sell weed.

“Obviously we have been monitoring this situation and its potential implications. However, without federal legislative change and specific direction from the provincial government, it would be premature for us to work on any concrete operational plans,” spokeswoman Christine Bujold wrote in an e-mail.

Some found humour in the juxtaposition between the LCBO’s brand image - it frequently runs classy-looking ads for expensive Scotches and stages in-store samplings of premium wines - and a soon-to-be-legalized drug.

Progressive Conservative MPP Tim Hudak quipped on Twitter: “I look forward to first glossy LCBO brochure promoting the high end pot and recommended munchies to go with it.”