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Quebec Premier Jean Charest responds to Opposition questions on the conflict with students over tuition hikes on May 2, 2012, at the legislature in Quebec City.Jacques Boissinot

The two most controversial issues in the province of Quebec – corruption and the unprecedented student strike – have collided to shake the Charest Liberals and deepen a climate of distrust toward government as a whole.

Over the past year, Quebec has been grappling with allegations of corruption, collusion, influence peddling and fraud that include the awarding of government contracts and the financing of political parties – allegations that have crystallized in the past month with a series of arrests. Now, as the corruption issue comes to a head, it competes for front-page headlines with student protests over tuition-fee hikes that have degenerated into violence in the Montreal streets and show no signs of ending.

The double-barrelled discontent has far-reaching implications for the province as a whole and its young people in particular. And in the short term, it has immediate political impact: While Premier Jean Charest once seemed inclined to call an election this spring, his caucus has warned that he could now be headed for disaster at the polls.

The latest sign of trouble was spurred by a news report on Wednesday revealing an embarrassing connection between a Montreal mobster and Education Minister Line Beauchamp's riding association. Not only does it compound the whiff of corruption, but it has the potential to undermine the very minister who is trying to resolve the student crisis, now in its 12th week.

According to the Montreal daily La Presse, Ms. Beauchamp attended a Liberal Party fundraising breakfast in 2009 where, among the 15 to 20 guests, was notorious Mafia figure Domenico Arcuri. Mr. Arcuri, the newspaper said, donated generously to the minister's Liberal riding association.

Mr. Arcuri's name was linked to the Rizzuto crime family during the 2006 RCMP crackdown on organized crime known as Operation Colisée.

"I don't know the individual in question and even today I wouldn't be able to recognize him," a shaken Ms. Beauchamp said in the National Assembly after being grilled with questions by the opposition parties.

Regardless of whether Ms. Beauchamp was aware or not that her party was soliciting funds from an underworld figure, the mere fact that an organized crime member was comfortable attending a political event was indicative of the dubious political ties created over time by unscrupulous entrepreneurs.

The fundraising event was organized by the consulting and engineering firm Genivar Inc., known for its close ties to the Liberal Party. Engineering firms have come under close scrutiny after allegations of price fixing and influence peddling in the awarding of lucrative government contracts to construction companies.

At the time, Ms. Beauchamp was minister of the environment and Mr. Arcuri's company Énergie Carboneutre Inc., which specialized in soil decontamination, was seeking changes to an environmental certificate of authorization to expand its business. The ministry granted the company the new certificate a year later. But Ms. Beauchamp insisted she knew nothing about the deal.

Under repeated questions from the opposition parties, the government was unable to explain why the Liberal Party funding activity had been organized by an engineering firm, and why the minister didn't notify the anti-corruption squad when she learned in 2010 that Mr. Arcuri's company obtained a certificate despite having Mafia connections.

While a public inquiry will soon examine the long list of corruption allegations, a number of charges have been laid against organized crime figures, federal tax officials, construction companies and municipal officials. A former provincial minister is under police investigation, and yet another was alleged to have accepted favours from an entrepreneur recently arrested by the province's anti-corruption unit.

For Parti Québécois Leader Pauline Marois, the government has been crippled by the revelations, and she wants an election immediately.

"Jean Charest said there would be an election when Quebeckers were ready for one," she said. "They are ready."

The decision on whether to call an election will likely be debated in the corridors of the Quebec Liberal Party meeting this weekend in Victoriaville. The decision, in the end, may be to wait until late summer – in the hope that, by then, the student protest will be over, the corruption issue will fade and the mood of Quebec voters will improve.