Labour treasurer Jack Dromey has told the party's conference he is confident it is ready for a general election - as he outlined the state of its finances.
Mr Dromey said Labour had learned from its mistakes
He said the party was "gearing up" for a general election: "I'm confident of our capacity to be ready. We will be."
Labour was "no longer racking up debts" but was "living within our means", he told delegates.
There has been much speculation that the prime minister is preparing to call an early general election this autumn.
Mr Dromey, who acknowledged the "shock to the system of 2006" from the revelation the party had been getting secret loans, did not give any clues as to when the election might be.
He pledged to end the "crazy arms race on election expenditure" and said a loophole in the law on loans - which meant there was not "full transparency" in how Labour raised money "has now been closed".
"If mistakes were made, Labour has learned from those mistakes and Labour is now leading in restoring trust and confidence," he said.
But he said he would not allow a review of party funding to break the "historic link" of the party with trade unions.
He said "tough decisions" had been made, staff reduced, financial organisation and budgeting controls had been improved, running costs cut by 15% and commercial income increased by 16%.
"For the first time since 2000 we are operating without an overdraft facility," he said.
"And we will have paid another £2m off our bank debt by the end of this year, taking it down to under £4m by the start of 2008 - which is down from £10m at the end of 2005."
He said the party was gearing up for the next general election and had developed new "strategic" campaigning tools like a new "contact creator" database for direct marketing campaigns.
But he said a major priority would be to build up party membership - which fell again in 2006 from the 407,000 peak when Labour came to power in 1997, to 177,000 in May.
He told delegates: "I'm confident of our capacity to be ready and we will be.
"But to do that we are going to need the most immense co-operative effort.
"You, all of you, have got to play your part - the trade unions and the socialist societies, and all those in the community at large who share our values and who know that a Labour government matters."
Gordon Brown has repeatedly refused to reveal his intentions for the date of the next general election - he could call it any time up to May 2010.