Which process allows citizens to propose a new law directly on the ballot in the next election by collecting signatures?

The process that enables citizens to propose a new law directly on the ballot in the next election by collecting signatures is known as an initiative. This democratic mechanism empowers the electorate to bypass the legislature and introduce specific legislation by gathering a predetermined number of signatures from registered voters within a defined timeframe. Once the necessary signatures are collected and verified, the proposed law is placed on the ballot for a public vote, allowing citizens to have a direct say in the legislative process.

Referendums, on the other hand, typically involve allowing voters to approve or reject laws that have already been passed by the legislature rather than proposing new laws themselves. Direct democracy is a broader term that encompasses various forms of public participation in governance, including initiatives and referendums. A recall vote is a specific process aimed at removing an elected official from office before the end of their term, which does not pertain to proposing new legislation. Thus, the initiative process stands out as the correct answer for allowing citizens to directly propose laws.