Williams rail review chair, former British Airways boss Keith Williams, has suggested the government should “take a step back” from the UK railway, in favour of a new arm’s length body or bodies to run it.

Williams said a fresh structure to run the railways was required, and warned that “simply tinkering at the edges” would not be credible. He added that rail franchising had “had its day”. Giving a wide-ranging progress update at a Northern Powerhouse event in Bradford, Williams also said that “today’s railway is not set up to be flexible, to lead, or adapt to major change.”

“The government set up the review because it recognised that the time had come for change. I was asked to lead this review with a brief to deliver ‘revolution’ not ‘evolution,’” he said. “The circumstances that led to the review’s launch - timetabling disruption, problems experienced with some major investment projects and the collapse of the Virgin Trains East Coast franchise - are all symptomatic of deeper, more fundamental issues in the railway.”

Williams said that when he and his team launched their review ten months ago, they began by listening to people at hundreds of meetings all over the country. “Listening has told us the government, industry, the regions, passengers, politicians from across the spectrum and everyone else with a stake in the railway are united in a desire for root and branch change,” said Williams. “So, the opportunity to deliver genuine, lasting reform here is huge.”

“I have been frank with the Department for Transport about the scale of change required, including a different role for DfT, to create a genuinely customer-focused industry. The secretary of state has, since the beginning of the review, challenged me to deliver revolution not evolution. And DfT permanent secretary Bernadette Kelly understands that, at the end of this review, simply tinkering at the edges will not be credible.

“And the government will have to step back from the railway. A wide range of organisations have argued in favour of a new arm’s length body or bodies to act as a ‘guiding mind.' It is an idea we’re looking at closely. In principle, it could have clear merit, working to solve some of the challenges the industry faces around accountability and fragmentation.

“One thing I am not considering is giving Network Rail control over the trains, as recent reports in the media suggest. This is no judgement on Network Rail, but you don’t create a customer focused railway by putting engineers in charge.”

The Railway Industry Association (RIA) welcomed Williams’ suggestion of an arms-length body, but both the Labour Party and the RMT Union were underwhelmed with the idea. David Tonkin, RIA chairman, said: "We welcome this move as we believe there is a need for government to devolve much of the day to day operation and co-ordination of the industry, and to concentrate on an outcomes-based approach. However, the new body must be set up with a clear terms of reference, responsibilities and vision to ensure that it is effective."

Labour said it backed such a body, “removed from government interference and micromanagement”, but said Williams “misses the point” and it should be all in public ownership. “Continuing with private train operators subject to performance-related payments means sticking with a failed, unaccountable and disjointed railway,” said shadow transport secretary Andy McDonald.

Mick Cash, general secretary of the biggest rail union RMT, said: "RMT warned from the off that Keith Williams had been hand-picked by Chris Grayling and the Tories to try and get them off the hook over the privatised chaos on our railways. RMT also warned that Keith Williams would side 100% with his big-business mates and duck the issue of public ownership of the railways - the option supported by over two-thirds of the British people."

Williams said he would deliver final proposals in the autumn for “revolution not evolution.”