Province could still back out of selling Cannabis NB, says top civil servant
Cheryl Hansen said the Crown corporation has done a good job creating efficiencies since opening
The New Brunswick government is in the final stages of negotiations to sell Cannabis NB to a private-sector company but could still pull out, according to the province's senior civil servant.
Cheryl Hansen told the legislature's public accounts committee that officials are still "monitoring" the retail operation, which is on track to beat its profit projections for the current fiscal year.
"They certainly have done an outstanding job relative to efficiencies and streamlining what's happening," Hansen said of Cannabis NB, which is a subsidiary of NB Liquor.
The stores recorded $62 million in sales and $8.3 million in net profit as of January, 10 months into the fiscal year, she said.
Even so, the government is following through on a Progressive Conservative commitment to explore selling the operation. Negotiations with "a top-ranked proponent" from among a pool of bidders started last October, Hansen said.
"We are in the final stages of that negotiation at this point in time," said Hansen, the deputy minister of finance and clerk of the executive council.
She said the negotiations don't prevent the province from pulling out.
"There is no determination until the end," she said. "Because we're negotiating now does not imply that this is a done deal and this will be sold."
She told the committee she could not identify the company the province has been talking to.
The Higgs government launched a request for proposals to take over the operation in November 2019, after heavy losses in its first year. But the company's fortunes began turning around last year.
Questioned by Liberal Leader Roger Melanson about the December resignation of NB Liquor and Cannabis NB CEO Patrick Parent after just 16 months on the job, Hansen said she had "no comments" on his decision.
"It was a real pleasure working with him and he did tremendous work" for both companies, she said.
Last October, Parent made the case for maintaining government ownership of Cannabis NB.
"We all have to understand that everything we do — our profits go back to the community," he said. "It goes back to pay for services, schools, hospitals, repaying the debt, so we take that duty very seriously."
Melanson said the average private-sector company needs five years to be profitable so the quick turnaround at Cannabis NB is significant.
"The government knows that and they're still negotiating," he said.
He said despite Hansen's comments about no "done deal," the Tories' minds appear to be made up.
"You don't negotiate if you don't want to get to an outcome where the original purpose was to sell Cannabis NB," he said.