Still (cash) crazy after all these years
Money-swilling politicians and over-indulging boozers have one thing in common; their hangovers can be unforgiving.
The Liberals should have learned that lesson a decade ago when they sold BC Rail to CN for cash and tax breaks worth maybe $1 billion. In the process of applying expensive lipstick to their fiscal pig, the government abandoned a valuable public asset that promised to be an engine of Hinterland economic prosperity if managed with vision and energy on behalf of taxpayers.
Refusing to be schooled by that still-smouldering fiasco, the Liberals are about to privatize another valuable public asset, the Liquor Distribution Branch (LDB), in order to briefly deflate the size of the operating deficit.
Ten years after BC Rail, the tune is so familiar: Still (cash) crazy after all these years. During a typically rancorous question period in the legislature this spring, NDP MLA Shane Simpson (Vancouver-Hastings) tried to get to the heart of the government’s ill-conceived and rushed decision to butcher the LDB cash cow.
Simpson wanted Energy, Mines (& Liquor) Minister Rich Coleman to explain the implications of a Business in Vancouver story that quoted from an internal memo making the rounds at Exel Logistics, a major global player in the world of liquor distribution.
The memo, Simpson told the House, had been penned by Exel vice-president Scott Lyons. It discussed Exel’s desire to get the LDB privatization contract by direct award and, when that could not be achieved, its determination to use “their strong relationship with the minister to influence the writing of the RFP (request for proposals).”
This “strong relationship” refers to the alleged influence of former Exel lobbyist and Liberal insider Pat Kinsella.
Coleman, a veteran Liberal ward boss who has rarely been out of sight of the booze file, sprang to his feet. “That question I can only categorize as the most demeaning, insulting and disgusting question I’ve heard relative to the public service of British Columbia since I’ve been here in 16 years,” he blustered.
To borrow from Shakespeare: Minister thou doth protest too much. The notion of Coleman being the valiant defender of the honour of the public service is laughable.
Here’s the deal: The LDB currently generates an annual profit for taxpayers in the neighbourhood of $900 million. But Finance Minister Kevin Falcon wants to off-load “non-strategic surplus assets” including B.C.’s monopoly on wholesale liquor distribution to reduce the operating deficit. He glosses over the fact that B.C.’s total accumulated debt is $52 billion and will skyrocket another $6 billion this year.
Somewhat after the fact, the government has appointed a fairness monitor “to oversee the procurement and evaluation process” and has hastily issued the RFP. However, it has refused to consult with stakeholders and it has failed to produce a business plan to justify the sale.
Many industry and consumer voices have raised the alarm about turning the people’s liquor distribution monopoly over to a private multi-national corporation.
BC Craft Brewers Guild chairman Tod Melnyk says brewers are “concerned that this initiative appears to replicate the Alberta liquor distribution model where there have been significant issues. The potential increase in pricing, which will impact consumer spending ... is also of utmost concern.”
All I can say is that when it comes to managing our assets this gang needs a designated driver. M