Ontario will propose “radically” changing the Beer Store’s stranglehold on the province in order to remedy decades of “unfair” practices, Kathleen Wynne says.

With a decision coming later this month on liberalized beer sales, the premier says her government shifted its thinking about the Beer Store as it learned more about how the quasi-monopoly discriminates against frustrated local craft brewers — and frustrates its customers.

“I think it has evolved into a very unfair monopoly, and I think that the people of Ontario need to see a better return from the Beer Store,” Wynne said in an interview Friday.

What started out as a slow drip has become a gusher for alcohol reform. A year ago Wynne appointed an outside panel headed by former TD Bank CEO Ed Clark to reassess government-owned assets such as the LCBO alcohol monopoly, and its relationship with the privately run Beer Store.

Initial reforms proposed by Clark last fall — charging the Beer Store a “franchise fee” but leaving its roughly 80 per cent market share unchallenged — were relatively tentative. The Star reported last month that Clark’s panel will now propose greater liberalization with as many as 300 licences auctioned off to supermarkets for the right to sell beer, raising additional funds while improving accessibility.

What persuaded Clark and the Wynne government to go further?

“I think the more he and his group explored the relationship with the Beer Store and explored how that model worked, the less palatable it was — and the more we all realized that it needed to change much more radically,” said Wynne, who has been briefed regularly on Clark’s findings and proposals.

Wynne noted that the Beer Store is braced for bad news, but it’s time to give Ontarians a better deal both in terms of cash flow and customer fairness.

“It’s been a very tough discussion as you can imagine,” Wynne mused. “What he is going to be proposing is going to be a very tough deal for the owners of the Beer Store to swallow. But I’m confident that it’s in the best interests of people.”

Craft brewers have grown rapidly in economic importance but weren’t getting a fair shake from the Beer Store, which is controlled by three big foreign-owned brewers that give preferential shelf space to their own products at the expense of smaller, locally owned rivals.

“This conversation between us started when I was talking about craft brewers, because the craft breweries are exciting, dynamic little businesses and they don’t have access to the distribution system that the bigger brewers do,” Wynne said.

While beer reforms will be implemented later this year, wine distribution in supermarkets is likely to take longer. Ontario politicians have been promising to liberalize beer and wine sales for three decades, but Wynne believes the time is right for reform — even if a consensus remains elusive.

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“There will be people who think we are going too far. But there will be probably an equal and opposite number who think we’re not going to go far enough.”

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