Bruce has drawn a line under the incident, which saw Butt leave the team hotel after being left out of the 16 involved in Monday's Premiership match with West Ham at Upton Park. Butt, on loan from Newcastle, was fined two weeks' wages (around £75,000).
"Nicky Butt is in the squad for Sunday," said Bruce. "He has been dealt with. He has been punished and he has apologised. As far as I am concerned, the matter is closed. With the injuries and all the rest of it, I am not going to cut off my nose to spite my face.
"Nicky has got an important role to play and he might have an important role to play from now until the end of the season. He has just got to handle the situation, simple as that, and he will do."
Across Britain's second city, David O'Leary has insisted "the slate is wiped clean" for Aston Villa midfielder Eric Djemba-Djemba after he returned late to the club, having spent a week in Cameroon after the African Nations' Cup.
O'Leary, whose side meet Manchester City in the FA Cup tomorrow, said: "We've had a meeting. We've heard his reasons. He knows he has let himself and the club down. He has been disciplined and the bottom line is we move on. He has trained very well and that is the end of the matter.
"I think he can be a snip for £1.3m if he starts playing the way we know he can. He is well worth that money if he starts performing. He has come to Aston Villa and we have only seen bits of that."