QUEBEC - Premier Jean Charest says he plans to set up a permanent unit to root out corruption in the construction industry.

Charest, who has been hit with a barrage of demands for a public inquiry into the industry, announced the plan after the Liberals were defeated in a byelection in Kamouraska-Temiscouata, a riding the party had held for 25 years.

Charest told a news conference Tuesday that he "humbly accepts" the voters' decision and acknowledged the issue of corruption has dominated the political debate for months.

Monday's byelection result "reflects what we see in the population in Quebec," he said.

"Many people are concerned about these allegations of collusion and corruption."

Public Security Minister Robert Dutil said the government has been quietly studying a permanent squad for months, and has been looking at New York's department of investigation.

"They had results and they still have results in New York with that kind of structure," he said.

Both Dutil and Charest suggested changes needed to be made to spot so-called bad apples.

"You have to keep weeding the garden," said Dutil.

"What happens in the industry – part of it is cyclical. It re-appears. It's the nature of the beast," said Charest.

The premier said he plans to step up the fight against corruption, but does not believe the solution lies in a government inquiry.

"We think that to act effectively, we must look to permanent solutions," said Charest.

"A commission of inquiry is not permanent."

Charest didn't want to set a timetable for the establishment of the agency, and Dutil only said he'll announce a decision in months to come.

"We'll take the necessary time. I want to do it right."

The transport ministry already has its own newly created anti-collusion squad, until recently headed by former Montreal police chief Jacques Duchesneau, and the Surete du Quebec's new Operation Marteau has been raiding construction company offices for the past year.

"Marteau is doing a good job, we are just looking at something permanent," said Justice Minister Jean-marc Fournier, adding that he trusts the work of provincial police.

Opposition not satisfied

Parti Quebecois Leader Pauline Marois was not satisfied.

"A permanent unit is not a bad idea but it is not enough," she said. "That's the problem. This is a roundabout approach. Why not act openly? What is the premier afraid of?

"At one point he has to put his foot down and say we need a real investigation, a real commission. This is what will fix things."