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Despite fierce opposition from within the party and trade unions, delegates backed a change in the requirements for a leader to be elected. The reforms were narrowly backed by 53.67 percent to 46.33 percent at the Labour Party's annual conference in Brighton.
Under the new system decreases the risk of a candidate being elected who does not have the support of the Parliamentary Labour Party.
In future leadership elections, candidates to have the support of 20 percent of MPs, up from the current 10 percent.
The registered supporters scheme, which allowed people who paid a small fee and sign a declaration of support to vote, will also be abandoned.
Sir Keir will be breathing a huge sigh of relief at the result after facing the humiliating prospect of having members reject his plans.
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The proposals were already vastly watered down for his initial plans after intense criticism in the days leading up to the party conference.
Currently there is a system of one member, one vote (OMOV) whereby all members have an equal say in the election of a leader.
OMOV was introduced by Ed Miliband in 2014 and was responsible for the election of Jeremy Corbyn the following summer.
Sir Keir wanted to return the system to the electoral college used previously, whereby MPs, unions and members hold a third of the voting rights each.
Making the case for the changes ahead of the vote, shadow work and pensions secretary Jonathan Reynolds said: "I have had the honour of being a Labour MP for 11 years.
"I have seen four general elections in that time, I have seen four leadership elections in that time, and I have often been on the losing side of these."
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He added: "I have only ever wanted two things: a Labour Party that can win an election and a Labour Party that deserves to win an election because it offers real hope and real change for the future.
"These are a package of rule changes that help us do both."
But in a debate over the changes in the conference hall, Labour delegates lined up to attack the plans.
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Megan Clarke, of Warwick and Leamington Labour Party suggested the changes would "limit the ability of the left of the party to lead us in the future".
She said: "This is not simply about left versus right.
"This is about increasing the power of MPs to choose our leader.
"This is about disrespecting the rights of hundreds of thousands of members and affiliate members."
Michael Stone, of Battersea Labour Party, accused the party's ruling executive committee of not trusting Labour supporters.
He said: "What a shocking lack of faith the NEC appears to have in members."
Sir Keir has been accused by those on the Lef of the party of focusing too much on internal battles rather than fighting the COnservative Government.
The Labour leadership said it was holding the votes this year so it could then turn full attention to winning the next election.