MONTREAL—With noisy demonstrators chanting outside, a besieged Laval city council put a hold on all future infrastructure contracts on Monday night, limiting itself to new spending only on matters of health and public safety.

“One down, one to go,” chanted demonstrators, calling for the resignation of Mayor Gilles Vaillancourt. Only hours earlier, the scandal-plagued mayor of Montreal announced he was leaving politics.

With the Surete du Quebec’s anti-corruption squad having raided Vaillancourt’s home, penthouse condo, office and bank over the past month, the mayor has temporarily stepped aside for “health reasons.”

Vaillancourt has faced allegations at the Charbonneau Commission that he pocketed 2.5 per cent of the value of each contract in Laval—allegations he has fiercely denied.

While the mayor’s critics expect that he will step down within days, Vaillancourt has run Laval for 23 years and his party has an iron grip on the island suburb.

“His resignation will come eventually, the raids and all the events of the past few weeks were just too powerful,” said Emilio Migliozzi, speaking for opposition party Mouvement Lavallois.

On Monday night, the vice-president of Vaillancourt’s executive committee, Basile Angelopoulos, announced the city council’s decision as a reaction to Bill 1, the Parti Quebecois’ new anti-corruption legislation. Under Bill 1, companies will be vetted before they can apply for public contracts in Quebec.

Laval could resume handing out contracts under the new bill once firms have been cleared and the city’s finances fully respect the new provincial law.

Vaillancourt wasn’t at the council meeting on Monday, continuing his period of “rest and reflection.”