Federal Labor leader Bill Shorten's push for a clean-up of the party will get its first test when the Victorian branch holds its annual conference this weekend.
Mr Shorten launched a reform plan in April aimed at more than doubling the party's membership to 100,000 and improving its electoral hopes.
The plan included allowing non-union members to join the party and allowing grass-roots members a greater say in preselecting candidates.
"If we are to renew and rebuild the Labor party, we must rebuild as a membership-based party, not a faction-based one," Mr Shorten said at the time.
The Victorian ALP conference, which Mr Shorten will address on Saturday night, will examine elements of the leader's plan as well as a review by former ALP official Andrew McKenzie titled Building a 21st Century Labor Party.
The McKenzie report is understood to advocate direct election of the state Labor leader by a ballot split equally between state MPs and grass-roots members - similar to that which elected Mr Shorten last year.
Combined with a rule change to allow new members to sign up to a central branch, rather than local branches, it could erode the power of factions.
A group of reformers, under the banner of the ALP Democracy Project, has been able to secure the election of more than 20 delegates to the conference.
The ALP Democracy Project delegates want members to have a vote on all internal positions and the leadership, secret ballots, no executive intervention in preselections and more opportunities to have a say on policy.
Former federal MP and conference delegate Race Mathews told AAP it remained uncertain how many recommendations would succeed but reform was necessary to achieve Mr Shorten's aim of higher membership.
"The issue of reform has taken on a renewed urgency in the light of the terrible (federal) budget and the need to position the party to mount an effective effort to resist and reverse it," Mr Mathews said.
Federal Labor MP Andrew Giles said in his submission to the McKenzie review the party had put off meaningful reform for far too long.
"Our structures and our culture are at a tipping point," he wrote.
"Our challenge now, is to grasp the nettle and face up to the real questions: not which faction or fraction wins or loses influence by reason of a rule change but how we keep Labor viable as a party of government by and for working people."
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