Just pay up, top minister tells MPs

Amid increasingly open dissent on the Labour backbenches over the former civil servant's demands, Home Secretary Alan Johnson insisted that the Legg review was "part of the solution, not the problem".

Mr Johnson did not rule out the possibility of MPs going to jail as a result of the expenses scandal, saying only: "The police are investigating at least three of our colleagues and we will have to see how it goes."

His comments came as Conservative MP David Wilshire announced he would stand down from Parliament at the coming election after allegations that he paid more than £100,000 of taxpayer-funded office allowances into a company which he jointly owned with his wife.

Mr Wilshire, MP for Spelthorne in Surrey, has referred himself to Parliamentary Standards Commissioner John Lyon and said he was confident he would be cleared of any wrongdoing.

But he said the investigation would cause distress to his family and friends and harm Tory chances of victory in the election expected in the spring, adding: "In the circumstances I have reluctantly concluded that it is sensible for me not to seek re-election next year."

As Mr Wilshire's case involves office allowances, it is unrelated to Sir Thomas's review of MPs' second home expense claims, which has sparked fury at Westminster by retrospectively imposing caps on cleaning and gardening costs.

Labour MP Claire Curtis-Thomas said many of her party colleagues at Westminster felt "bitterly let down" by Gordon Brown's failure to offer them "unequivocal" support over the issue.

Labour's MP for Stroud, David Drew, said Mr Brown appeared to have commissioned Legg's audit "on a whim" without taking enough care over its remit.

One Labour MP, Alan Simpson, has suggested that he would be ready to go to court to fight the £500 repayment demanded from him by Legg.