A former senior Labor figure says the party has lost its way and become an "accelerator for individuals' career paths".
Former NSW Labor government minister Michael Costa used a speech to the Liberal Democrats party conference in Sydney on Sunday to launch a scathing critique of the party of which he is no longer a member.
In the speech, obtained by AAP, Mr Costa says Labor reached its high point under Paul Keating and Bob Hawke but had been on a "downward spiral" since that time.
"It is an accelerator for individuals' career paths," Mr Costa said of the party.
"There's been a hollowing out of the ideology of the Labor party."
He said unions, which are now in low numbers in the private sector but strongest in the public sector, had skewed the party's thinking towards bigger government and more public spending.
"The types of union officials within the Labor party has made it even worse from the perspective of having a sensible political outcome for Labor," Mr Costa said.
Labor was also involved in a "political death struggle" with the Greens for inner city seats.
This meant that members of Labor's Right faction - such as NSW senator Sam Dastyari who he described as "barely wet behind the ears" - were prone to "conspiracy theories as bad as the Greens".
He cited as nonsense Senator Dastyari's recent claim that 10 big companies control politics in Australia.
But the former state treasurer said Labor taking on the Greens' agenda was pointless as, ultimately, inner city seats would end up in the hands of the Liberal party because of changing property values and demographics.
