This story is part of The Big Spend, a CBC News investigation examining the unprecedented $240 billion the federal government handed out during the first eight months of the pandemic.
Canadian alcohol distillers who pivoted early to produce hand sanitizer to keep Canadians safe from COVID-19 are crying foul as their hopes of solving longer-term supply chain issues appear to have evaporated.
When the prime minister called on Canadian industry to retool to produce protective equipment in the early panic of the pandemic, dozens of distillers switched from making spirits to hand sanitizer.
At the time, it was scarce on store shelves.
So dozens of Canada’s distillers scrambled to produce tens of thousands of litres for free. At the height of the shortage, about a dozen distilleries in B.C. alone were supplying hospitals, government offices and emergency workers all over the province.
As the months wore on, some distilleries began to charge to cover the cost of making the sanitizer, but many continued to donate thousands of litres to people and organizations in need, being careful not to profiteer in a time of crisis.
CBC News has learned that, during that time period, the federal government spent hundreds of millions of tax dollars procuring sanitizer from outside Canada.
At True North Distilleries, spirits are a family business. Left to right, Heather, Scot, Samantha and Meghan spent six months working around the clock producing hand sanitizer after the pandemic caused a shortage in March. (Geoff Fontes/CBC News)
In total, more than $570 million worth of hand sanitizer has flowed into Canada from outside countries since March, according to Statistics Canada data.
Of that amount, Canada paid directly for at least $375 million’s worth. BYD Canada Co., a China-based car maker with a few employees and offices in Canada, was paid $252 million for sanitizer manufactured in its retooled Chinese factories.
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Public Services and Procurement Canada told CBC in an email that of the 20.6 million litres of hand sanitizer bought, 52 per cent came from Canadian suppliers.
BYD was paid for 10 million litres of bottled medical-grade sanitizer, but there are no future plans to buy from the company.
Canada was faced with an “intense level of global competition” for medical supplies and moved to buy bulk one-time orders from international suppliers during the worldwide shortage, PSPC wrote.
Tyler Dyck, president of the Craft Distillers Guild of B.C., pivoted from whiskey making to hand sanitizer in March. His family runs Okanagan Spirits Craft Distillery in Vernon, B.C. (Curtis Allen/CBC News)
Smaller players shut out
That millions of tax dollars were paid out confounds distillers who were producing sanitizer for free. Many assumed that expedited changes to tax requirements and regulations to allow sanitizer production held promise that the government would continue to encourage at-home manufacturing. They requested compensation for supplies and in some cases consideration for longer-term contracts.
But none of that materialized for the smaller players.
The government of B.C. did buy about 7,000 litres of sanitizer, about a million dollars worth, from Parallel 49 Brewing Co. in Vancouver. But soon after, the province began shipping in sanitizer through a federal supply source, according to provincial officials, who said the priority was finding a “reliable source.”
Canada eventually signed agreements to make millions of litres of sanitizer with large Canadian companies: Fluid Energy Group in Calgary, Hawktree Solutions in Ottawa and Irving Oil in New Brunswick.
Meanwhile, distillers like Tyler Dyck spent nine months making and donating the disinfectant. He’s the president of the Craft Distillers Guild of B.C. and helps run his family distillery in Vernon and Kelowna.
“It really is like a sucker punch in the gut,” said Dyck, CEO of Okanagan Spirits Craft Distillery.
B.C. distiller Tyler Dyck and others in the industry answered the government’s call to Canadian businesses to step up and help early in the pandemic and retooled their production lines from spirits to sanitizer. They were never compensated for the effort even as the government paid foreign suppliers to meet the demand distillers say they could have handled domestically. 2:26
By summer, Canada had agreements with larger companies to deliver 20 million litres of sanitizer. While that solved the immediate shortage, distillers say it ignored their bids for contracts or at least compensation.
“You are bypassing people that have done the right thing from Day 1,” said Dyck.
Dyck said he has been called naive, but felt it was his family’s duty to produce the COVID protection when nobody else could. His company spent about $200,000 donating sanitizer.
“For our family … it’s the thing that made us feel more proud than anything,” he said.
Other distillers began to charge for sanitizer after weeks turned into months, to offset supply costs for things like bottles and chemicals needed.
Scot Stewart is the head distiller at True North Distilleries. His hand sanitizer was being used in about 14 per cent of the province at the peak of pandemic production. (Geoff Fontes/CBC News)
‘Very disappointing’
In Toronto, the Spirit of York Distillery was the first to distribute sanitizer. The owner says he got numerous calls from brokers looking to resell his raw alcohol and turn a profit.
“We couldn’t get a contract with the [federal] government no matter how hard we tried. It’s actually very disappointing,” said Gerry Guitor.
While some complained that distillery-made sanitizer can smell of booze, makers say it worked and created jobs.
Scot Stewart is the head distiller at True North Distillery in Grand Forks, B.C., another ad hoc hand-sanitizer maker.
“We scrambled and we scrambled a lot. We worked hard to catch up so people weren’t all living bottle to bottle,” said Stewart.
His bid to get a contract to keep supplying — or compensation for the $103,000 he’s spent — has been ignored.
“I am frustrated. We stepped up. The federal government eventually bought from offshore, and [sanitizer] started showing up in tankers in Vancouver harbour, but we kept donating,” said Stewart.
Stewart has spent the past nine months churning out B.C.-made hand sanitizer, only to be left with the tab and no federal contract to continue making it as she had hoped. (Geoff Fontes/CBC News)
His MP, Richard Cannings of South Okanagan-West Kootenay, lobbied Ottawa for distillers in his riding.
“In normal times, of course, companies wouldn’t produce material without a contract. But we were in very different times. There was a lot of fear and unknown. [Distillers] thought they were going to do the right thing and help the country,” said Cannings, an NDP member.
CBC asked federal ministries about compensation for the distillers. A spokesperson for the Minister of Innovation Science and Industry Navdeep Bains said Ottawa is grateful to the roughly 1,000 companies that pivoted to produce COVID protections such as masks and sanitizer.
“With personal protective equipment, we started with virtually no Canadian production, no self-sufficiency and a precarious international marketplace,” the email said. “We are immensely proud of how Canadian industry has stepped up to the plate.”
OTTAWA – The New Democrats confirmed Thursday they won’t help Pierre Poilievre’s Conservatives topple the government next week, and intend to join the Bloc Québécois in blocking the Tories’ non-confidence motion.
The planned votes from the Bloc and the New Democrats eliminate the possibility of a snap election, buying the Liberals more time to govern after a raucous start to the fall sitting of Parliament.
Poilievre issued a challenge to NDP Leader Jagmeet Singh earlier this week when he announced he will put forward a motion that simply states that the House has no confidence in the government or the prime minister.
If it were to pass, it would likely mean Canadians would be heading to the polls, but Singh said Thursday he’s not going to let Poilievre tell him what to do.
Voting against the Conservative motion doesn’t mean the NDP support the Liberals, said Singh, who pulled out of his political pact with Prime Minister Justin Trudeau a few weeks ago.
“I stand by my words, Trudeau has let you down,” Singh said in the foyer outside of the House of Commons Thursday.
“Trudeau has let you down and does not deserve another chance.”
Canadians will have to make that choice at the ballot box, Singh said, but he will make a decision about whether to help trigger that election on a vote-by-vote basis in the House.
The Conservatives mocked the NDP during Question Period for saying they had “ripped up” the deal to support the Liberals, despite plans to vote to keep them in power.
Poilievre accused Singh of pretending to pull out of the deal to sway voters in a federal byelection in Winnipeg, where the NDP was defending its long-held seat against the Conservatives.
“Once the votes were counted, he betrayed them again. He’s a fake, a phoney and fraud. How can anyone ever believe what the sellout NDP leader says in the future?” Poilievre said during Question Period Thursday afternoon.
At some point after those comments, Singh stepped out from behind his desk in the House and a two-minute shouting match ensued between the two leaders and their MPs before the Speaker intervened.
Outside the House, Poilievre said he plans to put forward another non-confidence motion at the next opportunity.
“We want a carbon-tax election as soon as possible, so that we can axe Trudeau’s tax before he quadruples it to 61 cents a litre,” he said.
Liberal House leader Karina Gould says there is much work the government still needs to do, and that Singh has realized the consequences of potentially bringing down the government. She refused to take questions about whether her government will negotiate with opposition parties to ensure their support in future confidence motions.
Bloc Québécois Leader Yves-François Blanchet hasn’t ruled out voting no-confidence in the government the next time a motion is tabled.
“I never support Liberals. Help me God, I go against the Conservatives on a vote that is only about Pierre Poilievre and his huge ambition for himself,” Blanchet said Thursday.
“I support the interests of Quebecers, if those interests are also good for Canadians.”
A Bloc bill to increase pension cheques for seniors aged 65 to 74 is now at “the very centre of the survival of this government,” he said.
The Bloc needs a recommendation from a government minister to OK the cost and get the bill through the House.
The Bloc also wants to see more protections for supply management in the food sector in Canada and Quebec.
If the Liberals can’t deliver on those two things, they will fall, Blanchet said.
“This is what we call power,” he said.
Treasury Board President Anita Anand wouldn’t say whether the government would be willing to swallow the financial implications of the Bloc’s demands.
“We are focused at Treasury Board on ensuring prudent fiscal management,” she said Thursday.
“And at this time, our immediate focus is implementing the measures in budget 2024 that were announced earlier this year.”
This report by The Canadian Press was first published Sept. 19, 2024.
OTTAWA – Treasury Board President Anita Anand has been sworn in as federal transport minister at a ceremony at Rideau Hall, taking over a portfolio left vacant after Pablo Rodriguez resigned from cabinet and the Liberal caucus on Thursday.
Anand thanked Rodriguez for his contributions to the government and the country, saying she’s grateful for his guidance and friendship.
She sidestepped a question about the message it sends to have him leave the federal Liberal fold.
“That is a decision that he made independently, and I wish him well,” she said.
Prime Minister Justin Trudeau was not present for the swearing-in ceremony, nor were any other members of the Liberal government.
The shakeup in cabinet comes just days after the Liberals lost a key seat in a Montreal byelection to the Bloc Québécois and amid renewed calls for Prime Minister Justin Trudeau to step down and make way for a new leader.
Anand said she is not actively seeking leadership of the party, saying she is focused on her roles as minister and as MP.
“My view is that we are a team, and we are a team that has to keep delivering for our country,” she said.
The minority Liberal government is in a more challenging position in the House of Commons after the NDP ended a supply-and-confidence deal that provided parliamentary stability for more than two years.
Non-confidence votes are guaranteed to come from the Opposition Conservatives, who are eager to bring the government down.
On Thursday morning, Rodriguez made a symbolic walk over the Alexandra Bridge from Parliament Hill to Gatineau, Que., where he formally announced his plans to run for the Quebec Liberal party leadership.
He said he will now sit as an Independent member of Parliament, which will allow him to focus on his own priorities.
“I was defending the priorities of the government, and I did it in a very loyal way,” he said.
“It’s normal and it’s what I had to do. But now it’s more about my vision, the vision of the team that I’m building.”
Rodriguez said he will stay on as an MP until the Quebec Liberal leadership campaign officially launches in January.
He said that will “avoid a costly byelection a few weeks, or months, before a general election.”
The next federal election must be held by October 2025.
Conservative Leader Pierre Poilievre said he will try to topple the government sooner than that, beginning with a non-confidence motion that is set to be debated Sept. 24 and voted on Sept. 25.
Poilievre has called on the NDP and the Bloc Québécois to support him, but both Jagmeet Singh and Yves-François Blanchet have said they will not support the Conservatives.
Rodriguez said he doesn’t want a federal election right away and will vote against the non-confidence motion.
As for how he would vote on other matters before the House of Commons, “it would depend on the votes.”
Public Services and Procurement Minister Jean-Yves Duclos will become the government’s new Quebec lieutenant, a non-cabinet role Rodriguez held since 2019.
This report by The Canadian Press was first published Sept. 19, 2024.
— With files from Nojoud Al Mallees and Dylan Robertson
