Image caption General election voters could win prizes

Labour should consider "entering everyone" who votes in general elections into a prize lottery, in an effort to reverse falling turnout, a senior party figure has suggested.

Shadow leader of the House of Commons Angela Eagle also said polling day could become a national holiday.

Labour is launching an inquiry into what it calls "flatlining democracy".

Other suggestions include online voting and installing ballot boxes at supermarkets and schools.

In a speech to the Hansard Society, which aims to strengthen parliamentary democracy and encourage greater public involvement in politics, Ms Eagle criticised Sunderland Football Club's new manager, Paolo Di Canio.

She said he had been questioned over "alleged fascist sympathies" and repeated his responses to the media: "I don't want to talk about politics because it's not my area... We are not in the Houses of Parliament; we are in a football club."

'Consumerist'

Ms Eagle said it was wrong for people including Mr Di Canio to think politics was "detached" from people's lives.

She added that even the families of victims of the Hillsborough disaster - who successfully campaigned over many years to reveal the truth about a cover-up - had told her: "We're not really into politics. We're not political."

They had done "something deeply political", she argued.

Ms Eagle promised Labour would set up a "people's inquiry" into voter disengagement, focusing on electoral turnout, reversing falling party memberships and publicising politics.

The panel would be made up of potential voters from around the country, in an effort to make Parliament "more relevant".

She said this could include "simplifying the legislative process so that the interested citizen can more easily understand and engage with it".

Ms Eagle suggested: "We should consider incentives for voting. How about entering everyone who voted into a lottery? What about making election day a bank holiday? Some have suggested compulsory voting, although I am personally dubious."

She criticised Thatcherism, saying it had created a "consumerist" society where people felt less keen to take part in politics, accusing the coalition of causing further disengagement with its spending cuts programme.

Ms Eagle added: "If we are not careful that will be the epitaph of our time - that people stopped believing that politics could change their lives for the better."

The ideas chosen by the inquiry are expected to influence Labour's manifesto for the 2015 general election.