LONDON - Britain's ruling Labour party on Saturday suspended a second MP in an expenses scandal that has scarred parliament's reputation and sparked public rage, after he claimed thousands of pounds for a mortgage he had already paid off.

On its ninth day of disclosures based on leaked expense claims by politicians from across the political spectrum, the Daily Telegraph said Labour MP David Chaytor would pay back about 13,000 pounds ($20,000) of taxpayers' money.

With two MPs now suspended and a junior minister stepping down pending an inquiry into expense allegations, Prime Minister Gordon Brown's Labour party has been hardest hit by the scandal, which has further fueled public dissatisfaction with a party that has been in power for 12 years.

Despite the suspensions, Labour has faced criticism for not punishing party members quickly enough, while the main opposition Conservative party has won some praise for cracking down on questionable claims.

A spokesman for Brown said Chaytor had been suspended ... from the privileges of membership of the parliamentary Labour party, pending further investigations by the parliamentary commissioner for standards.

The Guardian newspaper reported that any Labour MP found to have made improper claims would be automatically deselected and barred from standing at the next general election, due by mid-2010.

The paper, without citing sources, also said Brown had given ministers until Monday night to ensure that expense claims for the past five years were logged with parliamentary authorities.

The police have said they are considering launching a criminal inquiry into the expenses scandal next week.


Labour suspended former agriculture minister Elliot Morley on Thursday for filing 16,000 pounds ($24,330) in claims for a mortgage he had already paid.

On Friday, junior justice minister Shahid Malik became the highest-profile casualty of the scandal, stepping down pending an inquiry into allegations that he paid below-market rent for a house, breaching the ministerial code. He denies any wrongdoing.

The Telegraph's disclosures have embarrassed all the main political parties at a time when thousands are losing their homes in the credit crisis and many more are joining the ranks of the unemployed.

Claims for bath plugs, porn films and moat cleaning have angered a public already disenchanted with the political classes.

A key adviser to Conservative leader David Cameron quit his post over expenses this week and the party's senior politicians have started to post their claims online in an effort to win back public trust.

Analysts predict a backlash against the big parties in favor of more marginal groups such as the Greens, the anti-European Union UK Independence Party and possibly the far-right British National Party at local and European elections on June 4.

The scandal may also spill into the next parliamentary election, which must be called by June 2010. Opinion polls point to a big win for the Conservatives.

The Telegraph said Chaytor, MP for Bury North in northwest England, had apologized unreservedly for the interest payments claimed.

In respect of mortgage interest payments, there has been an unforgivable error in my accounting procedures for which I apologize unreservedly, he said in a statement to the paper.

Britain's 646 legislators receive an annual salary of almost 65,000 pounds and claimed 93 million pounds in expenses last year, an average of 144,000 pounds each.