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What Happened When Alberta Ended Its Liquor Monopoly

What Happened When Alberta Ended Its Liquor Monopoly
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Twenty years ago, the Alberta government canned its liquor retailing monopoly in favour of privatization for the benefit of the province and its people.

The competitive nature of privatization means better everything for consumers -- from pricing and choice to convenience and customer service. With 19,000 products on tap, Albertans can treat their taste buds to myriad wines from right here in Canada to Australia to Argentina and beyond. And they don't have to go far to do it -- the growth of liquor stores from 200 to 2,000 post monopoly usually means a short walk to the corner shop to buy one's beverage of choice.

For Alberta's 4,500 licensed restaurants and bars, privatization means something more: access to wholesale pricing and the ability to negotiate with local retail stores. Competitive pricing allows these small businesses, already struggling with high labour and food costs, to drive down their expenses -- giving them a better chance to compete against the growing array of home meal replacements from the grocery aisle that tempt consumers to stay at home or at their desks, instead of enjoying a meal out. When the province's fifth-largest private-sector employer gets a break, it's not hard to connect the dots on what this means for the economy -- new jobs, new businesses, and more money in the pockets of restaurant customers.

Indeed, privatization has allowed the restaurant industry to inject billions of dollars into the provincial economy. Alberta's restaurants employ 50,000 young people aged 15 to 24. That's the equivalent of giving one in six youth valuable, resume-building experience. A robust restaurant industry also grows jobs in other related sectors. From glasses and garnishes to cleaning supplies and construction, Alberta's restaurant industry is the proud source of 30,000 spin-off jobs.

But, the benefits of a successful restaurant industry go even further than job creation. Restaurants play a key role in community-building. Did you know that Alberta's restaurateurs gave close to $40 million to charity in 2011 alone? In addition to giving back, restaurants bring people together -- a commendable accomplishment in a world that's increasingly marked by social isolation. Restaurants are the impromptu boardroom for corporate executives, the local seniors' lunch spot, and the go-to place for a friends' night out. A recent Canadian public opinion poll by Ipsos shows that eating out takes the top spot for fun things to do with family and friends. With a greater choice of beverages and well-trained staff to ensure responsible drinking, dining out has never been so attractive. But without the advantages of privatization -- like wholesale pricing -- one may opt to drink at home alone, simply because it's cheaper.

Restaurants have a lot to bring to the table -- socially and economically - and privatization makes that offering all the more satisfying.

By getting out of the booze business, the government has also benefited. It's had more time to focus on matters that should be a priority for governments across the country, like essential public services, while continuing to enjoy a steady stream of liquor revenue from taxation. (Government actually earned more than anticipated in the first few years after privatization, and reduced mark-ups as a result.) And just because the government is no longer involved in the intimate details of selling liquor -- such as deciding what kind of Cognac to stock -- things haven't gone haywire as some pundits predicted. The government isn't teetering on a fiscal precipice and the streets aren't littered with drunkards. On the contrary, the number of drunk driving charges has dropped dramatically in the last two decades.

To this day, Alberta is still the only province to take the leap into the 21st century and fully embrace a wholly privatized liquor retail model. That's a sobering fact for other provincial governments that are fearfully holding on to their antiquated monopolistic liquor regimes. In the meantime, Alberta has enjoyed lower mark-ups, steadily growing provincial revenues, more jobs, new businesses, a booming economy, and social balance. This September marks the 20th anniversary of this all-round win situation, and that's a milestone worth toasting.

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