Should Ontario Allow Privatized Marijuana Dispensaries?

Current efforts to shut down existing dispensaries are proving to be unproductive.

Legalizing Weed in Ontario: The Rundown

The Ontario Cannabis Act, which will take effect on Jul. 1, 2018, means that you will soon be seeing provincially sanctioned marijuana dispensaries under the brand name the Ontario Cannabis Store licensed under the OCRC. The good news is that you’ll soon be allowed to buy weed without fear of getting arrested after you leave the store, the bad news is that you’ll only be able to get it from the one place. The OCRC stands for the Ontario Cannabis Retail Corporation which will serve as the province’s only legal marijuana retailer. The provincial marijuana corporation is a subsidiary of the LCBO, the crown corporation that serves as Ontario’s only liquor sales retailer.  

 The official logo for the Ontario Cannabis Store.

The official logo for the Ontario Cannabis Store.

Is This Really The Best Option?

However, should Ontario allow privatized marijuana dispensaries? Critics of the LCBO have long perpetuated beliefs that monopolizing the market hinders the growth and quality of public services. A monopoly on the marijuana market also means that current medical marijuana growers and existing dispensaries will be forced to shut down. Is this really the best move for our province? Current efforts to crack down on illegal cannabis operations in Toronto have proven to be largely unsuccessful so far. Store closures, raids and arrests have led to nothing but immediate re-openings, a steady stream of new stock and the majority of charges against store employees being dropped by the Crown Attorney. Constant efforts to shut down illegal dispensaries with no lasting effects is a huge drain on both the court system and police resources, not to mention taxpayer dollars. In an interview with CBC Toronto, Sgt. Todd Story of 12 Division stated that most employee arrests at dispensary raids are of low level employees that have very little to do with the overall operations of the store, therefore convictions are rarely ever achieved. “It basically drains on our police resources," Storey said, "It's a lot of man hours that we could be doing other things."

 A sign in the storefront of an illegal medical marijuana clinic.

A sign in the storefront of an illegal medical marijuana clinic.

Instead of trying to run the competitors out of business, perhaps Ontario could benefit from allowing a diversified market. The Cannabis Canada Association, a lobby group representing licensed medical marijuana growers stated to the Financial Post that "a competitive market model would provide the Province with a predictable, low-risk revenue stream without the taxpayer burdens of upfront capital expenditure exposure and operational risk". A possible caveat of legalizing cannabis should independent retailers be allowed to exist would be to impose a higher business tax greater than current corporate tax rates. This would allow existing cannabis companies to continue thriving while guaranteeing a certain threshold of tax revenue for the province. A diversified market for cannabis could also mean a better benefit for Ontario citizens through competitive pricing, greater access for customers and higher quality services offered.

The Need For Control

Why does the LCBO have a monopoly on liquor sales in the first place you might ask?

 The official logo for the Liquor Control Board of Ontario.

The official logo for the Liquor Control Board of Ontario.

Aside from its original mandate of making money for the government, LCBO publications have long claimed that social responsibility is a fundamental part of its operations and objectives. It is no surprise then that the LCBO would want to extend the same tightly controlled approach to marijuana sales. However, multiple studies conducted over the years show that the effects of cannabis consumption have proved to be nowhere near as dangerous and addictive as alcohol consumption.

I think the LCBO needs to rethink its plan to monopolize the weed market and allow for some healthy competition in the business. The LCBO should allow privatized marijuana dispensaries to exist alongside its own retail stores. Alcohol and cannabis are two separate substances and should be treated as such, it is unfair to force current business owners to give up their livelihoods and to force customers to buy only from them when there is an existing open market that is already working. Current plans for monopolization are simply draining municipal resources while affecting the livelihoods of existing businesses with little to no social benefit.

For more information on the legalization of cannabis in Toronto check out: https://lcbocannabisupdates.com/