British Prime Minister Rishi Sunak has ordered an investigation into Nadhim Zahawi as the Conservative party chairman faced growing calls to quit after paying a penalty to resolve a multi million-pound tax dispute.

Mr Sunak asked new ethics adviser Laurie Magnus to assess whether the former chancellor breached the ministerial code with the HMRC settlement.

Mr Sunak said the minister, who is defying Labour demands for his resignation, would stay on during the inquiry, launched as a series of scandals mounted.

During a visit to a Northampton hospital, Mr Sunak told broadcasters: "Integrity and accountability is really important to me and clearly in this case there are questions that need answering.

"That's why I've asked our independent adviser to get to the bottom of everything, to investigate the matter fully and establish all the facts and provide advice to me on Nadhim Zahawi's compliance with the ministerial code.

"I'm pleased that Nadhim Zahawi has agreed with that approach and has agreed to fully co-operate with that investigation."

In a statement, Mr Zahawi said: "I welcome the Prime Minister's referral of this matter to the independent adviser on ministerial standards. I look forward to explaining the facts of this issue to Sir Laurie Magnus and his team.

"I am confident I acted properly throughout and look forward to answering any and all specific questions in a formal setting to Sir Laurie.

"In order to ensure the independence of this process, you will understand that it would be inappropriate to discuss this issue any further, as I continue my duties as chairman of the Conservative and Unionist Party."