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Embracing competition: Reforming Liquor Retailing in Saskatchewan

Author: David Maclean 2004/11/22
Summary of recommendations

-In the 12 month period following the passage of 2005 provincial budget, SLGA liquor stores should be sold and licenses issued to prospective liquor store operators.
-Licenses and current liquor store locations should be offered to current SLGA employees before being placed on the market.
-The province should enter into a public/private partnership to manage the supply chain.
-Proceeds from the sale of assets should be used to pay down the provincial debt.
-Prospective operators should be required to operate liquor stores in locations that are separate and distinct from pre-existing retail operations.
-The current ad valorem system should be replaced with a base tax on beverage alcohol products.
-The total government markup on beverage alcohol should be reduced by 15 per cent, or $27,060,000 annually, based on 2003/04 SLGA Annual Report figures.
-Private retail operators should be permitted to remain open the same number of hours as bars, so long as such hours are permitted at the municipal level.

Conclusions

-Liquor prices are lower in Alberta
-In a competitive market, consumers enjoy better selection and more convenient hours and locations. In Alberta, the ratio of residents per full-service store is 3400:1, in Saskatchewan that ratio is 12,346:1.
-As evidenced by Alberta, increased liquor availability as a result of privatization has not increased the rate of liquor related crimes, including impaired driving.
-Government spending on the existing Saskatchewan liquor monopoly has jumped 20 per cent since 2000 - largely due to unsustainable payroll increases.
-Salaries at government liquor stores are significantly higher than those for similar job descriptions in other industries.
-Liquor privatization would result in hundreds of new entrepreneurs, hundreds of new jobs, and increased demand for store space, business supplies and services, computers, software, coolers, insurance, telephone and utilities, shipping services, vehicle sales and leases, advertising, security systems, and real estate.
-The CTF-recommended model would result in net savings of $7.7 million for taxpayers annually.

Attention editors: Copies of the report are available at www.taxpayer.com


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