Britain's political system is in danger of "meltdown" if major changes are not made, an independent report says.
The Power Inquiry, chaired by Baroness Helena Kennedy, says voters feel they have little influence over decisions affecting their lives.
The inquiry's Power to the People report calls for a shift in control from ministers to parliament, and from central to local government.
State funding of political parties and a voting age of 16 are also suggested.
The report drew on 1,500 public submissions as well as surveys and hearings held in the UK during the 12-month inquiry, funded by the Joseph Rowntree Trust to mark its centenary.
It cites the record low turnouts in the 2001 and 2005 general elections and falling membership of political parties as proof that "the current way of doing politics is killing politics".
"Politics and government are increasingly in the hands of privileged elites, as if democracy has run out of steam," Lady Kennedy said.
"Too often, citizens are being evicted from decision-making, rarely asked to get involved and rarely listened to."
As a result, people were turning away from voting and formal politics in favour of direct action and single-issue campaigns.
Donation restriction
Within parliament, the powers of party whips should be restricted in favour of more involvement from cross-party select committees, the report suggests.
And it urges greater power for local councils to administer their own finances.
It argues that individual donations to political parties should be restricted to Ј10,000.
In their place, individuals should be able to tick boxes on their ballot paper to give Ј3 of state funding to their favoured party, it says.
Age limits for both voting and standing for parliament to be reduced to 16, and a House of Lords to which 70% of members are elected, are also suggested.
And logs of ministerial meetings with lobbyists, pressure groups and businesses should be published for greater accountability, the report adds.
An inquiry spokesman said the recommendations were designed to tackle "the creeping threat of authoritarianism".
This could be achieved by "harnessing the kind of interest inspired by single-issue movements like the fox-hunting protests and Live8", he added.
(BBC)
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