Opposition leaders not high on how N.B. sells cannabis

As Cannabis NB continues to show lacklustre revenues, opposition parties are calling for changes to how the province sells cannabis.

Since opening the doors at its retail outlets in October 2018, Cannabis NB has performed well below expectations, failing to meet a projected $45 million in sales for the first fiscal year. Instead, it sold $18.6 million.

In the first quarter of the current fiscal year, the Crown corporation lost $2.2 million and weekly sales averaged $700,000 — half of what was expected.

Kris Austin, leader of the People's Alliance of New Brunswick, said it's "absolutely ridiculous and absurd" for the government to be involved with the sale of cannabis.

"Government shouldn't be in the business of selling much of anything," he told CBC's Information Morning Fredericton.

"Let the private sector do it. Let the competitive marketplace take care of it. Make sure government has proper regulations, gets fair taxes from it and set it free."

Austin said the construction of 20 new, standalone buildings across the province contributed to these losses.

"And then on top of that, you have the loss of product, not enough product on the shelves, you have layoffs, you had everything that just spiralled downward because government can't do anything right when it comes to business and retail," he said.

So far, 60 employees have been let go. Cannabis NB has blamed their financial problems on supply shortages and illegal sellers.

Follow Nova Scotia's lead: Coon

The province should remain involved with the sale of cannabis, but tweaks are needed, said David Coon, leader of the provincial Green Party.

"Remember that this is a controlled substance that can do harm," he said. 

"And so there are public policy objectives here, which is why it's important that that and alcohol are managed by the government."

Coon told Information Morning Fredericton that he liked Nova Scotia's cannabis business model, where cannabis is sold in the same building as the province's government-run liquor stores, but in separate rooms at the 12 locations where cannabis is sold.

Nova Scotia reported $33.2 million in sales in its first fiscal year, 76.6 per cent more than New Brunswick, despite Nova Scotia's population being just 25 per cent larger.

Coon also decried the cost of building the new cannabis stores. This could have been avoided, he said, had cannabis been sold through a branch of New Brunswick's own liquor corporation.

"We've got NB Liquor with a proven track record: it returns a good revenue to the people of New Brunswick, and it does a good job on the management and administration side," he said. 

"So, why would you turn that over to someone else?"

Previous government to blame, says finance minister

The New Brunswick Liberals, which came up with Cannabis NB's business plan while it was still in power, did not make anyone available for an interview.

"There needs to be more information on each option the government is considering before a decision can be made on which retail model to support," said Roger Melanson, the party's finance critic, in an emailed statement.

"Before making a final decision, the finance minister should provide a business case and the analysis behind it."

Speaking with Information Morning Fredericton last week, Ernie Steeves, New Brunswick's finance minister, suggested the previous government was to blame for the disappointing sales numbers.

"I'm not interested in throwing Cannabis NB under the bus," said Steeves.

"I mean, there's great workers over there, but they're saddled with a former government that set them up with a business plan that I don't think is a good one."

He said the government is looking at three options:

• Privatize Cannabis NB.
• Keep it and make some adjustments.
• Hand it over to a private sector entity, similar to the way Medavie handles the New Brunswick Extra-Mural program.

Steeves said the caucus has a retreat coming up later this month where they'll discuss these options and make a decision about Cannabis NB's future.

Last week, Steeves said he's hopeful things will improve for the Crown corporation once edibles hit the shelves.