The New Brunswick government spent $200,000 on their efforts to sell Cannabis NB to a private company since late 2019.
The provincial government announced in March that they would be retaining the provincial retail framework and discontinuing the effort to sell it. The initial request for proposal (RFP) to buy Cannabis NB was announced on November 14, 2019.
New Brunswick Finance Minister Ernie Steves said this $200,000 price tag included the entire RFP process during a Standing Committee on Estimates and Fiscal Policy meeting today, as first reported by the Telegraph-Journal. This includes the cost of a “fairness monitor” who will be releasing their report in the coming weeks on the process.
Steves told the committee that it was a prudent decision of the Higgs government to look into selling the crown corporation that has a monopoly on retail cannabis sales in the province.
When the government first announced the proposal, it said it was doing so because Cannabis NB was not yet turning a profit. This was, of course, due mostly to initial startup costs, the same as any other similar provincial retailer model or private retailer. Cannabis NB has since turned a profit over several consecutive quarters.
The Telegraph-Journal reports that a Finance spokesperson says a public report by the fairness monitor is due in the coming weeks on whether or not the process was documented properly.
“This is part of our efforts to energize the private sector, get our financial house in order and maximize the benefits for taxpayers and the government,” said Finance and Treasury Board Minister Ernie Steeves in November, 2019 . “After a careful and thorough review of the current business model for the sale of recreational cannabis and an analysis of alternative options, we came to the conclusion that the best approach for New Brunswick taxpayers and government is to turn to the private sector.”
By January 13, 2020 the province announced that eight proposals had been received in response to the RFP, from Canopy Growth Corp, Fire & Flower Inc., Green Stop Cannabis Ltd, Kiaro Brands Inc., Loblaw Companies Ltd., New Brunswick Association of Cannabis Distributors, RSL NB, and YSS Corp.
At that point, the provincial government said they expected a decision by Spring 2020. Then, partially due to COVID-19, the decision was delayed until the summer, and then again delayed until after a provincial election on September 14.
The New Brunswick government says that in order to protect the commercial confidentiality of the process and of the private sector participants, no further details of the short-listed proponents or their proposals will be disclosed.
“While we were pleased with the level of interest and engagement from the private sector, Cannabis NB’s performance over the past few months, as well as careful consideration of the social and economic implications of the retail model, has given us confidence that New Brunswick taxpayers and consumers can be well served through continued improvements within the current model,” said Finance and Treasury Board Minister Ernie Steeves last month.
Steeves said the government continues to focus on economic growth and recovery, and on actions designed to strengthen New Brunswick’s economy in the long-term.