Tory MP Derek Conway, who was expelled from his party in the Commons for giving his son public money, has announced he will stand down at the next election.

Mr Conway said in a statement released by Conservative Central Office: "I have had tremendous support from my local party, my family and friends but have concluded that it is time to step down."

Mr Conway may now face a possible police inquiry and fresh sleaze probe following a highly critical report which condemned his use of parliamentary allowances to pay his son Freddie more than £40,000.

Mr Conway was stripped of the Conservative whip by party leader David Cameron on Tuesday.

The House of Commons Standards and Privileges Committee said Mr Conway "misused" parliamentary funds by paying an annual £11,773 salary, plus bonuses of more than £10,000, to his younger son, who was "all but invisible" at Westminster.

It found the arrangement was "at the least, an improper use of Parliamentary allowances: at worst, it was a serious diversion of public funds".

Mr Conway's political rival Duncan Borrowman, the Liberal Democrat challenger for his Old Bexley and Sidcup seat, has written to the Metropolitan Police asking them to examine whether a fraud had been committed.

MPs are expected to vote on Thursday on the report's recommendation that Mr Conway should be suspended from the Commons for ten days and be required to repay up to £13,161 of the cash.

Now Parliamentary Standards Commissioner John Lyon is considering a complaint from Labour MP John Mann over allegations surrounding payments to Mr Conway's other son, Henry.

A newspaper has claimed that Henry, too, had been paid bonuses.

Committee members have disclosed they were aware that Henry had been employed by his father but were unable to investigate him because their remit was limited by the terms of the original complaint which referred only to Freddie.

The older son was reportedly paid about £32,000 in total from Mr Conway's staffing allowance while he was a student a few years before Freddie who finished university last summer.

Mr Conway - who was MP for Shrewsbury and Atcham from 1983-97 before succeeding Sir Edward Heath in his current seat in 2001 - apologised "unreservedly" to the Commons on Tuesday, adding that he had let his family down "very badly indeed".

But Mr Cameron said his use of public funds to pay Freddie as a parliamentary researcher when he was a full-time student hundreds of miles away in Newcastle was "unacceptable".

The withdrawal of the whip had made it all but certain that the former minister will be barred from standing as a Tory candidate in the next General Election.

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