Hundreds of people summoned the spirit of 1819 with a powerful and provocative demonstration against 21st-century inequality to mark 200 years since the Peterloo massacre.

Under leaden skies and driving rain, a crowd of Mancunians took part in a music-driven protest demanding action on issues including homelessness, disability rights and the climate emergency.

The bicentenary took place in the heart of Manchester, in a square of towering office blocks where 200 years ago sabre-wielding cavalry charged into a crowd of 60,000 protesters in one of the defining moments in British political history.

At 1.30pm – the exact time when troops were ordered to charge – the city fell silent to remember the 18 who died and the hundreds more who were injured as they gathered peacefully to demand political reform. Eighteen plumes of red smoke were released, one for each of the victims.

Direct descendants of those present at Peterloo were among those in the crowd. “It was a high point in 1819 of people being able to express what they wanted and what they needed from society,” said Sheila Lemoine-Abrams, 95, whose great-great-grandfather, John Barnish, marched with the radical reformer Samuel Bamford on 16 August 1819.

Facebook Twitter Pinterest Sheila Lemoine-Abrams, right, speaks to the gathered crowd. Photograph: Mark Waugh/The Guardian

“There are those who still feel ignored,” said Lemoine-Abrams, who served in the Women’s Royal Naval Service in the second world war. “I think [the Peterloo marchers] would not have been surprised that there are still inequalities for which they suffered then and people do still suffer now.”

Far from a straight-laced civic ceremony, performers took aim at the “bankers, total bankers” who plunged Britain into financial crisis and laid into Manchester city council for the “vile memorial” to Peterloo that was quietly unveiled this week amid criticism over its lack of disability access.

Wearing ceremonial chains, Manchester’s lord mayor looked on as Danny Collins, a 63-year-old former rough sleeper, criticised the city for “criminalising people who have nothing”. “Fined £50 for a tent, or £100 if you can’t pay,” he said. “Even the cranes look down on me. All the building going on but still nowhere to live.”

Quick guide What was the Peterloo massacre? Show Hide What was the Peterloo Massacre and how many were killed? On 16 August 1819, up to 60,000 working class people from the towns and villages of what is now Greater Manchester marched to St Peters Fields in central Manchester to demand political representation. Their peaceful protest turned bloody when Manchester magistrates ordered Yeoman – a private militia paid for by rich locals – to storm the crowd with sabres. Most historians agree that 14 people were definitely killed in the massacre – 15 if you include the unborn child of Elizabeth Gaunt, killed in the womb after she was beaten by constables in custody. A further three named people are believed to have either been stabbed or trampled to death. Why is it called Peterloo? The name was first coined five days after the massacre by James Wroe, editor of the Manchester Observer, the city’s first radical newspaper (no relation to the Observer of today). According to historian Robert Poole, Peterloo was “a bitter pun, comparing the cowardly attacks by the Yeomanry and soldiers on unarmed civilians to the brutality suffered at Waterloo.” What did the protesters want? They wanted political reform. The years leading up to Peterloo had been tough for working class people and they wanted a voice in parliament to put their needs and wants on the political agenda, inspired by the French Revolution across the Channel. Machines had begun to take jobs in the lucrative cotton industry but periodic trade slumps closed factories at short notice, putting workers out on the street. The Napoleonic Wars, which ended in 1815 with the Battle of Waterloo, had taken a heavy toll on the nation’s finances, and 350,000 ex-servicemen returned home needing jobs and food. Yet those in power seemed more interested in lining their own pockets than helping the poor. At that point, only the richest landowners could vote, and large swathes of the country were not represented in Westminster. Manchester and Salford, which then had a population of 150,000, had no MP, yet Oxford and Cambridge Universities had their own representation. At the time the extension of the vote to all men, let alone women, was actively opposed by many who thought the vote should be restricted to those of influence and means. Why is Peterloo important? It paved the way for parliamentary democracy and particularly the Great Reform Act of 1832 which created new parliamentary seats, particularly in the industrial towns of the north of England. It also led to the establishment two years later of the Manchester Guardian by John Edward Taylor, a 28-year-old English journalist who was present at the massacre and saw how the “establishment” media sought to discredit the protesters. Helen Pidd, North of England editor Photograph: Rischgitz/Hulton Archive

There was a low-key appearance by the environmental campaigners Extinction Rebellion in bright red robes, while 100 volunteers played the role of “Laurels” – those who carried laurel branches at Peterloo as a symbol of peace and amity.

Mike Leigh, the award-winning director of a film about Peterloo released last year, said the incident was “totally relevant” to today, drawing parallels with the protests in Hong Kong, Brexit and the public’s dwindling confidence in politicians.

Facebook Twitter Pinterest Environment activists clad in red were part of the anniversary commemorations. Photograph: Mark Waugh/The Guardian

“If the guys who were here 200 years ago could get into a time machine and come forward to 2019 and discover that people have the vote and they don’t use it, they would be absolutely outraged, horrified and disgusted and would find it obscene,” he said on the fringes of the event.

Leigh described Brexit as a “complete disaster”, adding: “People actually haven’t got a voice. Don’t let Brexiteers and leavers say they had a voice and they voted in the referendum – people didn’t know what they were voting about except a load of lies, basically. It was a tragedy.”

Denise Southworth, whose great-great-great-great-great grandmother Mary Heys was trampled by cavalry and later died while giving birth, said Manchester had “criminally neglected” its Peterloo past and was in danger of losing its history with its rapid regeneration.

Would the Peterloo marchers be satisfied with today's Britain? Read more

Heys, she said, was born in a city centre house where a McDonald’s now stands and was buried in a cemetery beneath what is now a huge Selfridges, a high-end haven for footballers and celebrities. “Underneath all those shops where they’re selling belts for £500 are people who tried to protest for a loaf of bread,” Southworth said.

A small blue plaque on the Radisson hotel was the only permanent memorial to Peterloo near the site of the massacre until this week, when a new £1m monument was made public to a chorus of criticism from disability rights activists. The Peterloo Memorial Campaign, which joined criticism of the monument, said it would use the bicentenary to launch a new reform movement aimed at “rebooting this ailing democracy”.

The project has asked members of the public for ideas on improving democracy in Britain. “The 200th anniversary has fallen at a time when confidence in democracy is at an all time low,” said Paul Fitzgerald, the campaign chair. “The most powerful testimony you can make to the reformers of 1819 is to carry on that tradition.”