MONTREAL - Gilles Duceppe has put an end to speculation that he wants to replace Pauline Marois as leader of the Parti Quebecois -- at least for now -- saying he can't imagine a return to political life as he works to restore his reputation.

The former Bloc Quebecois leader announced Sunday that he will devote his time clearing his name after a Montreal newspaper reported he mishandled public funds while he was head of the federal party.

"I am therefore unable to consider a return to active politics," he said in a statement.

Duceppe didn't indicate, however, whether his decision to stay out of politics was permanent.

He wasn't accepting interview requests Sunday.

La Presse reported on Saturday that Duceppe paid his party's general manager for seven years with funds designated to run his Ottawa office.

The newspaper said Gilbert Gardner was hired in 2004 to work at the Bloc's headquarters in Montreal and earned a salary of more than $100,000 in the final years of his term.

One NDP MP said Saturday the payments would be a violation of parliamentary rules.

Joe Comartin, vice-president of a parliamentary committee on procedure and house affairs, said the House of Commons funds were meant for activities related to Parliament, not for partisan ones.

Duceppe denied any claims of wrongdoing. He said he handled the Bloc's House of Commons budget with transparency and honesty.

"Everything was done in compliance with the rules," he said.

Although he stepped down as Bloc leader after the party's disastrous showing in last May's election, Duceppe remains an important figure within Quebec's sovereignty movement.

Rumours had been swirling that he was working behind the scenes to take over Marois at the head of the struggling provincial PQ.

One published report last week said Marois called Duceppe and asked him whether she could state publicly that he was not interested in the leadership. He reportedly told her she couldn't say that.

In the statement he issued Saturday, Duceppe said he continued to have "complete confidence" in Marois and the provincial party.

A spokeswoman for Marois said the PQ leader, who has vowed to stay on as head of the party until the next election, wouldn't be commenting on Duceppe's decision.

At a news conference Sunday before Duceppe's announcement, Marois avoided attacking the former Bloc leader over his alleged misuse of public funds, saying he was innocent until proven guilty.

"I know Gilles Duceppe as a man of integrity who acts in good faith," Marois said in Montreal.

Marois said she wasn't aware of the details of the allegations and knew nothing about them before they were published.

She had called the news conference to show off another PQ candidate for the next election, the second since Friday as she tried to quell leadership speculation.

Speaking with reporters, Marois even repeated an offer made earlier in the week for Duceppe to join the party.

"My offer still stands," she said. "We are never stronger than when we are united."

Marois hasn't had an easy time as PQ chief since receiving 93 per cent support in a leadership vote last spring.

Several members of the legislature quit over her leadership and another raised the possibility of the party disappearing.

Liberal Premier Jean Charest has until the fall of 2013 to call an election.