He told a Labour Party conference on local government in Bournemouth that councils had to be more visible, exciting and professional. 'We must certainly look at the idea of having fewer council committees and perhaps fewer councillors, alongside an extension of community and parish councils.'
He argued for some full-time, properly paid councillors to run 'our local authorities, but with a clearer distinction between the role of the offices and that of the elected representation'.
It was the duty of councils to stand up for their communities against the overweening power of the state, Mr Straw said.
He later added: 'Local government has a problem of status. It is a vicious circle. As more powers have been removed, it has become less attractive to people of high calibre.
'A full-time elected and paid mayor would be able to focus on the needs of the community. We need to look abroad, to France, Germany and the United States. Our local government is still very largely built on a Victorian committee structure. It needs to change.'
Last night Mr Straw claimed that the Government's policies towards local government are making the recession worse.
'The very services which are most under pressure from the mounting army of unemployed - social services, education, welfare, housing - will be cut, charges will be increased; while those services which cater for people whether in work or out of it, from libraries and schools through to public transport and the road system, will all suffer a degradation in their quality.'
He added: 'For every 10,000 local authority jobs lost which add 10,000 to the dole, the cost to this country, in benefits paid out and tax foregone, will be pounds 900m. So a myopic policy aimed at saving a few million will instead cost the country hundreds of millions.'
Mr Straw said that the Tories had been trying to smear Labour in local government for years. 'That's what John Major was up to on Wednesday - going for the big lie - claiming that after 14 years of continuous Tory rule it was Labour to blame for the state of Britain, trying to pretend that the intense social problems now faced in our inner cities . . . were not the product of his own policy, but of ours. Isn't Mr Major aware that he is the Prime Minister?'
He said the Tories now had more power at their disposal than any peacetime government this century.' The party of Joseph Chamberlain now has a local government policy of which Joseph Stalin would have been proud.'