ALP national president Greg Sword yesterday declared one-third of Victorian Labor's 12,000-strong membership to be "branch-stacked", calling for new penalties to be imposed on MPs and party members found guilty of the practice.

Mr Sword told The Age up to 70 per cent of branch members paid an annual $29 membership fee - a concessional rate that "assisted those who are involved in branch-stacking activity".

"There is a deep suspicion in the party that the majority of those (concessional members) are stacked," he said. "We say there is a serious problem that the party needs to deal with."

Mr Sword, general secretary of the National Union of Workers, called on the state ALP to support rule changes beyond the reforms adopted at Labor's national conference last year.

He said party members found branch-stacking should be expelled or suspended from the party. MPs found guilty of branch-stacking could also lose party endorsement for five years, meaning they would not be able to stand as an ALP candidate for at least one election.

The proposals are due to be considered at the party's state conference in May. In its formal submission to the conference, Mr Sword's union urges putting responsibility on party officials to act when they became aware of such practices. It says they should be subject to a new code of conduct, overseen by a party obudsman. It calls for state conferences to be annual, instead of twice a year, with delegate numbers up by 350 to 800, and it says the party should consider having 400 conference delegates electedm directly by local branches, rather than federal electoral assemblies.

Mr Sword said the state branch should consider eventually "opening the conference to all members of the party when it comes to policy decisions".

The push by Mr Sword comes as a factional brawl within the state branch intensified yesterday, with right-wing ALP figures accusing him of overturning longstanding power-sharing arrangements between factions.

Mr Sword pulled his union out of the right-wing Labor Unity group last year and has teamed with the Socialist Left and other smaller groupings to seize control of the state branch. The alliance incensed Labor Unity by using its numbers last week to claim four of five positions at the party's state headquarters.

Senator Stephen Conroy, a leading Labor Unity figure, accused Mr Sword and the Left's Senator Kim Carr of destabilising the branch by turning their back on the past practice of power-sharing between the factions.

The Australian Workers Union, a leading Labor Unity-aligned union, has proposed rule changes for the party conference, such as "reinstatement of proportional representation at every level of the party".