Opposition questions government if it's ready to capitalize on cannabis legalization

P.E.I.'s Official Opposition wants to know why there wasn't a competitive bid process and no public tenders for which companies the government will buy cannabis from once it's legalized.

Finance minister says province will work with local companies once they're approved

P.E.I.'s Official Opposition questioned how the province will capitalize on cannabis legalization in the legislature Tuesday. (CBC)

P.E.I.'s Official Opposition wants to know why there wasn't a competitive bid process and no public tenders for which companies the government will buy cannabis from once it's legalized.

Opposition Leader James Aylward also asked how the province plans to capitalize economically on the legalization of cannabis in the House Tuesday. The Progessive Conservatives pressed government for details on its business plan for marijuana, suggesting the province isn't prepared to capitalize on legalization.

Government has signed agreements with three companies to supply the province with 3 million grams per year, including Canada's Island Garden in Charlottetown, which is now 75% owned by a U.S. company. The other two companies are OrganiGram of Moncton, N.B., and Canopy Growth Corporation of Smith Falls, ON. 

"This government has known for close to three years that Ottawa planned to legalize cannabis. This shouldn't have caught anyone by surprise," Alyward said. "Why does your government's response to cannabis legalization seem to be thrown together at the last minute?"

Province has to buy from federally-approved suppliers

Finance Minister Heath MacDonald said the province has prepared for legalization by securing suppliers and product through the memorandum of understandings that were signed, which are not legally binding contracts. He said those agreements make sure the product will be available for consumers through retail outlets. MacDonald also said the province has to use federally-approved suppliers.

Finance Minister Health MacDonald says P.E.I. can only buy cannabis from federally approved companies. (P.E.I. Legislature)

There's also only one licensed grower and seller on P.E.I. — Canada's Island Garden — and the company has said it sold all the marijuana it can grow this year, and is looking ahead to a massive expansion for future years. The company provided the province with three market reports to help it determine the right amount to buy in total, which would include some from other companies. 

Aylward also asked if government has looked at potential value-added opportunities for Island businesses with the sale of cannabis. 

MacDonald replied saying government will continue to look at all companies. 

Regulation before normalization

"We're dealing with federal regulated companies at the present time. As licenses are approved by the federal government moving forward, whether that be cannabis extraction or what have you for oil, then we'll be dealing with those companies in Prince Edward Island," MacDonald said. 

He said he wants the industry to grow, but cannabis needs to be regulated before it's normalized.

Opposition Leader James Aylward pressed government on what plans it has in place to capitalize on the legalization of cannabis. (P.E.I. Legislature)

Premier Wade MacLauchlan said the province's approach to cannabis legalization is in compliance with and meets the initiative taken by the federal government. He said the first two concerns are to give Islanders a well-informed choice and make product available.

Brad Trivers asked if the finance minister can table the business plan the province has developed around the legalization of cannabis and copies of the MOUs with suppliers. 

MacDonald said he would look into whether he's able to make the agreements public since they involve outside companies.

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Krystalle Ramlakhan is a multi-platform journalist with CBC Ottawa. She has also worked for CBC in P.E.I., Winnipeg and Iqaluit.