The UK prime minister has said parliament must do more than clean up its expenses system to restore public trust,
Gordon Brown's announcement on Saturday came after his ruling Labour party suspended a second politician in the scandal.
A week of leaked reports detailing expense claims made by members of UK parliament showed that David Chaytor, MP for Bury North, claimed £13,000 ($20,000) of taxpayers' money for a mortgage he had already paid off.
Brown's political spokesman said Chaytor, who has promised to repay the cash, had been suspended pending an inquiry.
With two MPs now suspended and a junior minister stepping down while allegations about his finances are investigated, Labour has been hardest hit in a scandal which has scarred parliament's reputation and could influence coming elections.
"Unacceptable behaviour will be investigated and disciplined. I do not rule out any sanction," Brown said in an article to be published in Sunday's News of the World newspaper.
"Trust has been badly damaged and cannot be restored simply by rectifying past mistakes and reform to the expenses system.
"As well as righting wrongs and cleaning up the system, there is now a clear need to go much further," he said.
Porn and dog food
Claims for lawnmower repairs, dog food, pornography films and moat cleaning have angered recession-hit Britons already disenchanted with the political classes.
The affair has also fuelled growing dissatisfaction with a Labour government in power since 1997.
With local and European polls due on June 4, analysts expect a backlash against the big parties in favour of smaller groups such as the Greens, the anti-European Union UK Independence Party and even the far-right British National Party.
The scandal could also spill into the next parliamentary election, which must be called by June 2010. Opinion polls point to a big win for the main opposition Conservatives.
The police have said they are considering launching a criminal inquiry into the expenses scandal next week.
Labour suspended Elliot Morley, the former agriculture minister, on Thursday for filing £16,000 ($24,330) in claims for a mortgage he had already paid.
On Friday, Shahid Malik, the junior justice minister, 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.
Despite the suspensions, Labour has faced criticism for not punishing its MPs quickly enough, while the Conservative party has won some praise for cracking down on questionable claims.
A key adviser to David Cameron, the Conservative leader, quit his post this week and the party's senior politicians have started to post their claims online to try to win back public trust.
The Telegraph said Chaytor, an MP in northwest England, had apologised "unreservedly" for the interest payments claimed.
"There has been an unforgivable error in my accounting procedures," he said in a statement to the paper.
Britain's 646 politicians receive an annual salary of almost
£65,000 pounds. Reports allege they claimed £93m in expenses last year, an average of £144,000 each.