Shipley MP Philip Davies has called for the Metropolitan Police to reopen its investigation against former minister Denis McShane, who has admitted fiddling expenses, and expressed his alarm that the Rotherham Labour MP was being protected by parliamentary privilege.

Letters from Mr MacShane admitting expenses abuses cannot be used to prosecute him because they are protected by Commons rules, it has been revealed.

Officials said parliamentary privilege meant the key correspondence was withheld from police when they held a probe into the MP two years ago.

The documents are still not legally admissible - even though they were published in a Commons sleaze report yesterday.

The situation emerged after the Standards and Privileges Committee detailed how Mr MacShane knowingly submitted 19 false invoices over a four-year period.

The cross-party group said the invoices were "plainly intended to deceive", branding it the "gravest case" they had dealt with.

Conseravtive MP Mr Davies said: “I think that is a very sad state of affairs. All it will do is further undermine the reputation of parliament.

"There will be millions of people out there who think that MPs are above the law and that is what the perception will be.

"It seems that someone who should be brought to justice isn't going to be."

It is understood Mr MacShane formally applied for the post of Crown Steward and Bailiff of the Chiltern Hundreds last night – the traditional way of resigning from the Commons.

Chancellor George Osborne is expected to confirm his appointment today, at which point he will cease being an MP.

George Galloway said his Respect Party will field a candidate to fight for the Rotherham seat.

The Bradford West MP also called for Mr McShane to be prosecuted. He tweeted: “Dennis McShane MP must stand down and we will stand in the Rotherham by-election for sure.”