Ford’s decision to speed up alcohol sales expansion will cost province $612M: report

TORONTO — Premier Doug Ford’s decision to speed up the rollout of alcohol sales in corner stores — which first sparked early election speculation last spring — will cost the province more than $600 million, Ontario’s budget watchdog said Monday.

That’s nearly three times the amount the Progressive Conservative government said it would cost to accelerate the timeline.

The Financial Accountability Officer wrote in a report Monday that the expansion of beer, wine and coolers to convenience stores, big box stores and more grocery stores will cost $1.4 billion through to 2030, and $612 million of that is due to the sped-up timing.

However, that could be much higher or much lower depending on rates of alcohol consumption and consumer behaviour, Jeffrey Novak wrote in his report.

“The actual financial cost to the province will depend on how retailers and consumers respond to the expansion of the beverage alcohol marketplace,” he wrote.

“After accounting for these and other factors, the FAO estimates that the financial cost to the province could range from $529 million to $1.9 billion through to Dec. 31, 2030.”

Ford’s previous plan was to expand sales of those alcoholic offerings by 2026, but in May he announced that would instead happen in 2024.

The province said an “early implementation agreement” with The Beer Store involves Ontario paying the company up to $225 million to help it keep stores open and workers employed.

Novak said there will also be a $215-million cost as a result of lower tax revenues as grocery, big box and convenience stores are not subject to beer, wine and spirits taxes.

As well, Novak said there will be $172 million in lower net income to the Liquor Control Board of Ontario. While there will be a $1.1 billion increase in wholesale LCBO revenue, there will also be an approximately $812 million decline in LCBO retail revenue, a $192 million cost to give wholesale discounts to new retailers, $150 million in service rebates to brewers, $105 million in higher operating expenses, and $22 million in higher recycling fees.

The report landed just days before Ford has indicated he will call a snap election, well over a year before the June 2026 fixed date, and the opposition pounced on the opportunity to frame the FAO’s findings as evidence of financial mismanagement.

Liberal Leader Bonnie Crombie said it shows Ford has the wrong priorities.

“Doug Ford’s priorities are clear, and they’re not about serving you,” she said. “The $1.9 billion, it could have been used to hire 1,400 family doctors — 1,400 — and that would have been able to care for two million people.”

Green Party Leader Mike Schreiner said it’s indicative of Ford’s general spending patterns.

“Two billion dollars for a waterfront spa in Toronto, $3.2 billion on rebate cheques that are going to millionaires and billionaires — meanwhile our health-care system crumbles and housing starts are bottoming out,” Schreiner wrote in a statement.

Anne Kothawala, president and CEO of the Convenience Industry Council of Canada, said the alcohol expansion has provided a much-needed boost to the convenience sector as year-over-year December sales increased by 15 per cent from 2023 to 2024.

“Our store operators are excited to finally offer this product to customers and see the increased foot traffic from this move,” Kothawala wrote in a statement.

“The report ignores the research about the impact of expansion on job creation and additional taxation into the provincial coffers.”

NDP Leader Marit Stiles said the price tag shows Ford is not the shrewd operator he sets himself out to be.

“This is another example of Doug Ford and the Conservatives not being able to make a good deal for Ontarians,” she said. “Doug Ford likes to pretend like he’s some great negotiator and he obviously can’t get a good deal done.”

This report by The Canadian Press was first published Jan. 27, 2025.

Allison Jones and Liam Casey, The Canadian Press