09/01/2017 10:26 AM AEDT | Updated 09/01/2017 8:17 PM AEDT

Health Minister Sussan Ley Stands Down Amid Expenses Probe

Sussan Ley loses Cabinet position while travel claims are investigated.

Vision Courtesy ABC News 24

CANBERRA – After days of pressure, Health Minister Sussan Ley has stood aside, without ministerial pay, over an entitlements scandal, at the same time as a describing the controversy over her tax-payer funded travel as a "distraction."

Ley's action, which she regards as temporary which travel claims are investigated, comes after speaking to the Prime Minister Malcolm Turnbull and a day after apologising for an "error in judgement".

She has admitted to several expenses irregularities that she will be adjusting and repaying.

The minister had charged taxpayers for a trip to the Gold Coast in which she bought a $795,000 apartment and there are also questions about other taxpayer-funded flights to the Gold Coast, including New Year's Eve trips in 2013 and 2014.

On Monday Ley confirmed she had attended a New Year's Eve party and lunch upon invitation from a "prominent Queensland businesswoman". On Monday afternoon, Ley's office confirmed it was multimillionare Sarina Russo.

Russo -- a recruitment and training tycoon -- was ranked 13th on the 2015 BRW Rich Women list and is a political donor who has won contracts from the Coalition. Russo released a statement on Monday saying she was happy to assist the investigation.

Sussan Ley and Sarina Russo.

Labor insists she should have resigned from the Turnbull Cabinet outright, but Ley is confident she will be cleared of wrongdoing.

"I have nothing to hide. I have not broken any of the rules," Ley told reporters out the front of her electorate office in Albury in regional New South Wales.

"I'm very confident that the investigations will demonstrate that no rules were broken whatsoever."

However, she hit back at media outlets reporting on her use, or possible misuse, of entitlements as she declared she would not be making her diary public.

"My diary is available to be inspected, as I said, by the Department of Finance and the Prime Minister's secretary," Ley said.

"Will I allow the media access to go on a fishing expedition, perhaps at the cost of confidentiality of some of the both confidential and commercial in-confidence meetings? No, I won't."

She said the decision to stand aside was mutually agreed with the Prime Minister and she said she had apologised for the distraction.

"I apologise for the distraction that this issue has caused, since it arose, I think, late last week, to the agenda of the government and my colleagues in Cabinet," she said.

"Now, I'm calling it a distraction because that is what it is."

Ley repeated her original statement that the purchase of the Gold Coast apartment was "neither planned nor anticipated".

She has also found several irregularities in travel claims which she says she will be be adjusting.

Two for accommodation in the Gold Coast for meetings in Brisbane, "when in hindsight I should have stayed in Brisbane," and one where she flew from the Gold Coast to Canberra at the start of parliamentary business in 2015.

"In fact it was of lest cost to taxpayers but was from a location where I was staying personally rather than my home base," Ley admitted.

But Labor's acting leader Penny Wong is not satisfied and is demanding Ley's resignation. She has described Turnbull's response as "another weak response from a weak Prime Minister".

"What we see is the Prime Minister squibbing it, and he is squibbing it again," she told reporters in Adelaide.

"I mean, you have to ask Mr Turnbull this - what are your ministerial standards worth? What are they worth?"

There are now two investigations into her travel claims, one by the Finance Department and the other by the Secretary of the Department of Prime Minister & Cabinet, Martin Parkinson.

Turnbull has released a statement, insisting the matter is being taken seriously.

"Australians expect the Government to deal with these serious matters very thoroughly and in accordance with the Statement of Ministerial Standards," the Prime Minister said.

"I expect the highest standards from my Ministers in all aspects of their conduct, and especially the expenditure of public money."

Cabinet Secretary Arthur Sinodinos is now acting as Minister for Health, Aged Care and Sport