TORONTO -- Ontario's Liberal government will not allow corner stores to sell beer and wine, but will broaden their availability through specialty outlets and grocery stores, Premier Kathleen Wynne confirmed Tuesday.

"We have a terrific distribution network and we're going to continue to work with the LCBO to increase that distribution network," Wynne told reporters.

The Ontario Convenience Stores Association -- which includes 7-11, Rabba and Mac's as well as Petro-Canada, Imperial Oil and Canadian Tire -- wants the law changed so they can sell local wines and craft beers.

It's time to modernize the province's alcohol retailing system, and corner stores have agreed to dedicate 30 per cent of their beverage shelf space to Ontario wines and craft beers, said association CEO David Bryans.

"This isn't about replacing the LCBO, The Beer Store or private wine stores," he said. "We're talking about adding to the system for the benefits of Ontario wineries, craft brewers and consumers alike."

Selling beer and wine in corner stores was an idea first proposed by former Liberal premier David Peterson in the 1980s, but his government never followed through on the idea.

It's an issue that still divides Ontarians, said Wynne, with many people believing, like the government, that the LCBO is more socially responsible when it comes to keeping alcohol out of the hands of minors than corner stores would be.

"This is an issue that has two schools of thought on it, and I'm quite sure right now my constituency office is getting calls on both sides of this issue," she said.

The government wants to expand the availability of Ontario beers and VQA wines in specialty stores, and will set up LCBO outlets in 10 grocery stores as a pilot project, but won't allow alcohol sales in corner stores, said Finance Minister Charles Sousa.

"In fact, we just came out with new boutique stores that highlight home grown wines and local craft beers," he said. "We've actually catapulted some of these very industries that otherwise would have not been possible were it not for the intervention and leadership of the LCBO."

The Progressive Conservatives favour expansion of beer and wine sales to privately owned retail outlets, but the NDP supports the government's position that the LCBO provides good services and product selection in a socially responsible manner, and doesn't want to see the products sold in corner stores.

"You look at LCBO stores you have great choice of products, you've got affordability and it's really a service that's responsible in regards to how you sell alcohol," said NDP house leader Gilles Bisson. "We have to take our responsibility when it comes to alcohol to make sure that only those people of age are able to buy it."

The convenience stores association -- which says it represents 10,000 retailers employing about 75,000 people across Ontario -- also wants the province to restrict what products the Beer Store can sell. It said some Beer Stores offer "confectionery goods, clothing, gift cards, and barbecue paraphernalia" such as propane tanks.

"The fact that The Beer Store was granted a monopoly in this province to sell beer products, rightly or wrongly, should be reason enough to limit them from competing with businesses that currently do not have the same government granted ability," the association said in a submission to Ontario's Alcohol and Gaming Commission.

"In not prescribing a set list that is considered fair by our sector, The Beer Store will always have the potential to become 'convenience stores that sell beer' and put legitimate family-run stores out of business."

The Beer Store, which is owned by Anheuser-Busch of Belgium, Molson Coors of the United States and Sapporo of Japan, said small Ontario brewers can list their products in as many of its 447 retail locations as they want, and can set their own prices.

There are already 219 LCBO agency stores inside convenience stores in communities that aren't large enough to support a regular liquor store.