Rail franchising has been "ended" by extending measures introduced to keep trains running after the coronavirus outbreak, the Department for Transport (DfT) has announced.
Operators have been moved to "transitional contracts" ahead of the creation of a "simpler and more effective structure" which will be developed over the coming months, the DfT said.
The department has taken on franchise holders' revenue and cost risks since March, at a cost to taxpayers of at least £3.5bn.
"Significant taxpayer support will still be needed" under the new Emergency Recovery Management Agreements, the DfT said.
The new system will pave the way for wider reform of the rail industry reform that was being drawn up before the pandemic by Keith Williams, the chairman of Royal Mail.
Transport Secretary Grant Shapps said: "The model of privatisation adopted 25 years ago has seen significant rises in passenger numbers, but this pandemic has proven that it is no longer working.
"Our new deal for rail demands more for passengers. It will simplify people’s journeys, ending the uncertainty and confusion about whether you are using the right ticket or the right train company.
"It will keep the best elements of the private sector, including competition and investment, that have helped to drive growth, but deliver strategic direction, leadership and accountability.
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"Passengers will have reliable, safe services on a network totally built around them. It is time to get Britain back on track.
"Until passenger numbers return, significant taxpayer support will still be needed, including under the transitional contracts announced today. But the reforms will enable substantial medium and longer-term savings for taxpayers."
Keith Williams, chair of the Williams Review, said: "These new agreements represent the end of the complicated franchising system, demand more from the expertise and skills of the private sector, and ensure passengers return to a more punctual and co-ordinated railway.
"I am ensuring the recommendations I propose are fit for a post-COVID world, but these contracts kickstart a process of reform that will ensure our railways are entirely focused on the passenger, with a simpler, more effective system that works in their best interest."
The measures have been welcomed by Newcastle's Go-Ahead Group, which operates a number of rail franchises in the South East.
David Brown, Go-Ahead CEO, said: "This contract reaffirms the Government's recognition of the important role rail plays in driving economic growth and in connecting communities.
"Independent passenger surveys have found that people who have recently travelled on our services found them to be clean, safe and reliable. We look forward to welcoming more passengers back onto our trains."
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Paul Plummer, chief executive of the Rail Delivery Group, said: "We welcome the ongoing support to keep trains running for passengers and the government’s confirmation of an end to the franchise system, which we have long been calling for.
"These transitional contracts should be a stepping-stone to a better railway. This needs to harness the experience, innovation and investment private sector operators bring, with local train companies taking the decisions that affect their passengers. It should be overseen by a new guiding mind for the whole industry and underpinned by a simpler to use fares system.
"A renewed and reinvigorated partnership between the public and private sectors will be the best way to improve services and help regrow the market for train travel which is good for economic recovery and the public finances. Combined with the measures the industry is taking to keep trains clean, this announcement means people can continue to travel with confidence."