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Provincial governments will bear the burden of legalized marijuana

The Trudeau government is set on legalizing marijuana by the summer of next year. While they will enjoy the political payoff of appearing progressive on this matter, all of the associated problems and the logistics of legalizing pot will fall on the shoulders of the provincial governments.

October 17, 2017  By Malcolm Bird

There are strong correlations between how a drug or a particular indulgence, such as gambling, is made available to the public and the propensity for individuals to indulge in it and the negative health and social outcomes associated with its use.

In other words, it matters how we legalize marijuana not just that we legalize it.

Canadian provincial governments might want to draw lessons from the last time an illegal substance was legalized — alcohol — following prohibition in the late 1920s, as well as insights from the current public health efforts to eliminate tobacco use.

For starters, it might make sense to make acquiring recreational marijuana reasonably expensive and somewhat difficult.


All provincial governments (except Alberta, which eliminated their liquor board), should consider selling only recreational marijuana in government liquor stores because they have the secure infrastructure in place to deal with a drug with narcotic properties. They also have well-trained and professional staff and secure logistical facilities to ensure it is distributed in a socially responsible manner. This will eliminate the potential enormous political problem of licensing and determining where (and when) dispensaries will be permitted to open and operate. It will also eliminate the possibility of organized criminal elements establishing and operating dispensaries.

Most critically, the government should not only control the retail end of marijuana, but the wholesale side as well. They should sell recreational marijuana as a “store brand” in plain packaging and offer only a few different types. This will prevent manufacturers from developing and promoting specific brands of pot through advertising campaigns.

“Store brands” are more profitable for retailers largely because they gain more control over manufacturing and cut out supplier middlemen. As the sole wholesaler in a province, provincial liquor boards will be able to drive hard bargains with manufacturers.

There must also be significant taxes imposed on marijuana. But taxes will not earn significant revenues as the government must also cover the costs associated with its (mis)use.

Government revenues from the sale of pot will already be restricted given the decline in pot prices over the last 25 years: a gram of pot in the 1990s cost $15 while a gram today cost less than $10 on the illegal market.

Contrary to popular belief, the legalization of marijuana will require an increase in police and legal efforts to stamp out the black market. When government liquor commissions took over alcohol distribution bootleggers had to be eliminated or they would both undercut the state’s monopoly on sales and its ability to control how it was sold and consumed.

Policies will also need to be developed to allow the police to determine which pot has been legally procured and which has not. Since federal legislation will permit individual Canadians to grow their own marijuana plants at home, verifying legally procured marijuana will be considerably more difficult.

Provinces should also be wary about offering edible pot. Ingesting marijuana substantially increases its potency and is often sold as child-attractive products such as brownies, gummy bears and the like, substantially increasing the potential for accidental consumption – including by children. If provinces do decide to sell edibles, they should ensure that dosage amounts per item are consistent amongst different products, and are presented in a manner that is easy for consumers to understand.

The provinces will also need to establish a permit and purchase tracking system. Such a practice would allow the government to determine who is purchasing marijuana and if individual sales could be tracked to original purchases, this would aid in preventing marijuana ending up in the hands of minors. Persistent violators who resell marijuana, for instance, could have their permits revoked.

Governments should consider restricting the purchase age to 21 as recommended by many medical practitioners, and in order to limit consumption and normalization of its use, there should also be no advertising or promotion of marijuana.

I make these suggestions as a way for provincial governments to make the best of a very difficult situation. Consumption of marijuana will likely rise, as will the associated costs of dealing with its effects on individuals. Like many issues in Canadian federalism, this is a classic one where the federal government is wholly detached from the reality of implementing the policy, and the real costs associated with it.

Malcolm G. Bird teaches political science at the University of Winnipeg and is an expert advisor with

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