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Province tables legislation to cancel Beer Store contract

Last Updated May 27, 2019 at 11:46 pm EST

The Ontario government has officially tabled legislation to cancel the province’s 10-year agreement with The Beer Store.

“During the last election we promised to put the people first, including by growing jobs and expanding convenience for Ontario consumers,” Finance Minister Vic Fedeli said as he brought forward the bill at Queen’s Park on Monday.

“The province’s current beer distribution is owned by three global giants who were handed a sweetheart deal by the previous government and who are more interested in protecting profits than providing convenience and choice for average people. It’s a monopoly that’s a bad deal for consumers and businesses and is deeply unfair to the people of Ontario.”

Fedeli says the legislation will nullify the master framework agreement and will protect taxpayers of Ontario against any costs that will be sought for civil liability. “We will not allow the taxpayers of Ontario to be held hostage by the Beer Store’s three multinational owners.”

The motion is called the Bringing Choice and Fairness to the People Act.

The Beer Store intends to challenged the legislation. In a statement, Beer Store president Ted Moroz said:

“The government cannot extinguish our right to damages as outlined in the Master Framework Agreement. It is critical to understand that The Beer Store has, in good faith, based on a legally-negotiated 10-year operating agreement with the Province of Ontario, invested more than $100 million to modernize its stores and to continue to upgrade the consumer experience.

“We have today sent a legal letter to the government and will fight this legislation vigorously through the courts and we remain committed to protecting the 7,000 Ontarians who work at The Beer Store and rely on these jobs to support their families.”

Fedeli didn’t mention how much this move could cost the government but reports have indicated the cancellation of the contract could cost Ontario close to $1 billion.

The province’s goal is to bring the legislation to a final vote before the current sitting of the legislature concludes. The summer break starts on June 7.

The union representing The Beer Store employees said the legislation will result in the loss of “7,000 jobs and billions in taxpayer dollars.”

“Doug Ford promised no one would lose their jobs as a result of his policies,” Union President John Nock said. “And now he’s cancelling contacts, creating chaos and kicking good jobs to the curb. We will fight this government and this premier to keep our jobs and to save the taxpayers the billions Ford is willing to pay to put beer in corner stores.”

Interim Liberal leader John Fraser criticized the legislation calling it, “fiscally irresponsibility because the government is going to end up spending money fixing this deal that could be used better, in healthcare and schools.”

“This government has an obsession with alcohol, we saw that in the budget. I don’t think it’s in line with Ontarians’ most important priorities – healthcare and education,” said Fraser.

NDP MPP Sandy Shaw said there’s no guarantee the people of Ontario won’t have to pay “hundreds of millions of dollars” to end The Beer Store contract. She added this will send the wrong message to businesses: “The government is ripping up contracts at the drop of a hat.”