Ed Miliband's clash with the unions will come to a head with a 'special' party conference next spring, in a bid to get the confrontation out of the way 12 months before the next general election.
The Labour leader, laying out a detailed timetable for the changes he hopes will turn his party into a mass membership organisation, told a London audience he wants to open up Labour's policymaking, clean up the lobbying industry and "take the big money out of politics".
Allegations that the Unite union has attempted to influence the selection process in up to 40 constituencies have prompted Miliband to seek broad reform, in a major gamble with the future of the Labour movement in Britain.
"We want to let people back in," he said.
"So I want all Labour party members, supporters, trade union members involved in this dialogue, leading up the special conference this spring to agree change.
"All of our country's history shows that change does not come just from a few people at the top.
"Change comes when individual people come together to demand it. The Labour party has a chance to help make that happen."
Under the proposed reforms trade union members will no longer fund Labour by default. Instead they will be individually affiliated to Labour, offering the party a more direct relationship with their members but risking a significant fall in its total funding.
Miliband is not addressing funding issues directly in his speech at Coin Street. Instead he underlinend the need for Labour's links with union members to be "real, local and vibrant" and contrast them with the Conservatives' reliance on a small number of wealthy donors.
"Britain's working people don’t get to have cosy dinners in Downing Street to discuss policy, like David Cameron's big donors," he added.
"They don't have lobbyists looking after their interests, like the big tobacco companies do with Lynton Crosby.
"Britain's families don’t get enormous tax cuts, like the hedge funds and the millionaires.
"That's why they need a party that is open to them. That is on their side. A One Nation Labour party for all the people of Britain, not just a few at the top."
Interim reform proposals will be published at the party's autumn conference, making clear what rule changes are needed to Labour's constitution to push them through.
Meanwhile Miliband will hold a series of town hall meetings to sell the idea, while deputy leader Harriet Harman and other shadow Cabinet members campaign in favour of the reforms.
Not all in the Labour party are meeting the proposals with enthusiasm, however.
Miliband's first choice as shadow chancellor, Alan Johnson, today warned that he believed the union selection scandal was not something that required a change in party rules.
"What happened up in Falkirk can be dealt with by the party rules now, which they couldn't in the past," he told Total Politics magazine.
"Other changes mean we can handle the odd breakout like Falkirk. I disagree with my colleague Kim Howells, to turn this around into an attack on the unions.
"If you look at where the problems are, whether it's the financial services, banking, the problems in the press… it isn't the trade unions, so let's not make them a big factor in this."