Gordon Brown said money would go to frontline services

The Chancellor also used the hour-long speech defend Labour's record on health and education.

And to launch a blistering attack on the Conservative leadership's record while in office.

Mr Brown told delegates cutting bureaucracy would increase investment in frontline services.

He said examples from devolution and localisation would be key to a public spending review which would have the theme "frontline first".

He reminded the conference that Wales "should and would" benefit from a share of 20,000 civil service jobs being relocated from Whitehall to the regions.

He said: "Let us embrace public sector reform as the means by which, in our generation, the collective endeavour of all helps us to realise the potential of each, and we meet a new generation's new aspirations offering personalised services for all."

Good management by Labour helped them win the argument with the Conservatives on public services.

Peter Hain: 'The past has been tough'

The Welsh Labour Party received praise for leading the way in promoting women in the party.

Referring to the majority of women in the assembly and the executive, he said: "What Wales has done today, the rest of the world will do tomorrow."

He also praised the Welsh Labour's record for caring for pensioners.

"Wales under Labour is leading the UK in ensuring dignity and prosperity for pensioners in Wales," he told delegates.

And he claimed 100,000 children had been taken out of poverty in Wales since Labour came to power.

Later Welsh Secretary Peter Hain told the conference they must be ready to fight for a "third successive general election victory".

'Persuasive'

His speech was geared almost totally towards elections he praised his Labour colleagues in the Welsh assembly for achieving a majority government last year.

He predicted the party would win back control of Caerphilly and Rhondda Cynon Taf in June's council elections and that elections to the European Parliament would see the return of MEPs Glenys Kinnock and Eluned Morgan to Brussels.

Speaking in advance of next week's publication of the Richard Commission report into the powers and electoral arrangements of the Welsh assembly, Mr Hain also said that if "the case for change is persuasive, we will look at it with an open mind".

"We will do so in comradeship and consultation, MPs and AMs together, constituencies and trade unions together, Welsh Labour and British Labour together, governments in Westminster and Cardiff Bay together."

He admitted that recently times had been difficult for the Labour Party: "The past has been tough. But if we hold firm to our course of reform and social justice we can achieve the historic goals of our movement" he told delegates.