Andrew Laming has decided not to contest the next federal election, but Treasurer Josh Frydenberg believes there is no need for the Queensland MP to leave immediately despite his "unacceptable" behaviour.
The LNP member for Bowman has been in embroiled in distasteful social media behaviour against women, coming at a time when the Morrison government has been under the spotlight over the culture in Parliament House.
Mr Frydenberg said after speaking to the prime minister on Saturday, Mr Laming has decided not to stand at the next election, which is due next year.
"His behaviour has been absolutely unacceptable," Mr Frydenberg told reporters in Melbourne on Sunday.
Asked whether Mr Laming should stand down immediately, the treasurer said: "No."
"He continues to serve in his constituents in the parliament."
In a statement on Saturday, Mr Laming had said he would step down from all parliamentary roles to undergo counselling.
He is due to return to parliament on May 11 when the budget is handed down.
But Labor Leader Anthony Albanese said Mr Laming is not fit to be a member of parliament.
"Andrew Laming should go. He brings disrepute and disgrace to our national parliament and he simply should go," he told reporters in Sydney.
If Mr Laming were to leave straight away, it would leave the government in a minority.
At least two Liberal female politicians will be happy with Mr Laming's decision.
Liberal MP Katie Allen said what Mr Laming has been doing is completely outrageous and it would appear that 17 years in parliament is getting to him.
"I really think he needs to have a pretty serious look about whether he will recontest the next general election," Dr Allen told ABC's Insiders program earlier in the day.
Asked whether she was comfortable with Mr Laming being in the party room, Senator Sarah Henderson told the program: "I'm not comfortable with the conduct and I hope that Andrew makes the right decision."
Alcohol and drug testing of ministers was thrown up in the Insiders' discussion as ideas to try to improve the culture.
The government already has two ministers on prolonged sick leave - Defence Minister Linda Reynolds, which followed her mishandling of an alleged rape of one of her staff in her office, and Attorney-General Christian Porter after he was accused of alleged rape when he was a teenager, which in strenuously denies.
These cases have unleashed a slew of claims and evidence of unsavoury behaviour in the house of lawmaking, with female Liberal politicians speaking out about the toxic nature of the house of lawmaking.
"I think for all women in the Liberal Party, we are pretty angry but I do want to make the point that there are many men in our party who are also disgusted and very angry about what has happened," Senator Henderson said.
"It is an historic opportunity to get this right and to address the things that are not right for women, not just in Parliament House, but across the country."
Former senior public servant Jane Halton said clearly this workplace has to change.
"There have been problems for years and years and years," she told Sky News' Sunday agenda program.
"We need to have proper respect for everyone who works in this building. I don't care if they are the cleaner, if they work in the cafeteria, if they work in a member or senator's office, they should be treated with appropriate respect.'
Australian Associated Press