The rule change is an integral part of Mr Smith's campaign for 'one member, one vote' in internal party elections. A consensus is forming around a period of six months' party membership before the right to vote is earned.
The development follows a letter signed by more than 80 Labour MPs warning Mr Smith that if new members could vote immediately they signed up, it would be possible to swamp local parties with 'voting armies' who could back sponsoring paymasters as candidates.
When announcing his backing for the so-called 'levy plus' scheme of cheap subscriptions for political levy-paying trade unionists on 19 May, Mr Smith said of the 12-month rule: 'It would not in my opinion be right to encourage a large number of new members who, because of this rule, would not be able to participate in selections (of parliamentary candidates) to be held in 1994.'
That was almost universally received as a suggestion that the rule should be swept away in its entirety, a move that had not been discussed in the parliamentary party and which stirred up behind-the-scenes rumblings over Mr Smith's allegedly remote leadership style and other perceived party ills.
It was pointed out that since many constituencies have fewer than 200 members, a parliamentary seat could effectively be bought for pounds 1,000 by anyone prepared to pay membership fees for about 100 supporters.
Some on the party's 'modernising' wing have suggested the MPs' protest could be viewed as an attempt to protect the status quo in constituencies which, though safe, are effectively run by handfuls of members unwilling to question the continuing tenure of incumbents. With the demise of Militant, there was said to be minimal need for safeguards against 'swamping'.
Mr Smith is having to tread carefully on party membership, in spite of the urgent need to increase it from its current 253,067, more than 8,000 fewer than last year and the lowest since 1929.
The need for some form of check on the bona fides of applicants is now accepted by the leadership.
Mr Smith has privately mooted the six-month figure for levy-paying trade unionists, which will now be discussed by the review group studying links with the trade unions.
But other suggestions are also likely to find their way on to the table, one being that there should be no waiver of the 12-month rule for non-trade unionists paying full-rate fees.
Another is that new trade unionist members should be exempted from any waiting period provided they have paid the political levy for at least 12 months before joining the party.
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