A U.N. envoy proposed Wednesday that the U.S.-appointed Governing Council cease to exist June 30 and said the United States should surrender sovereignty to a "caretaker" government of respected Iraqis.

U.N. Undersecretary-General Lakhdar Brahimi (search) said the new government should be led by a prime minister, a president and two vice presidents until elections are held in January.

The proposed new structure would give Washington a way to dissolve the fractious and unpopular 25-member Governing Council named by the United States.

Brahimi's proposals came as Iraq's U.S. administrators have been anxious to show progress on the political front amid this month's surge in violence, the most widespread and deadly since the fall of Saddam Hussein. Fighting around Baghdad and Fallujah and in the south has left many Iraqis fearful over the country's future and heightened resentment of the U.S. occupation.

The new leaders should be "men and women known for their honesty, integrity and competence," said Brahimi, who was asked to come up with a plan for Iraq's transition by the Iraqi Governing Council and the U.S.-led coalition.

Brahimi told a news conference he would present his recommendations to U.N. Secretary-General Kofi Annan (search). The plan would require acceptance by both the Governing Council and the coalition authority.

The caretaker government would be chosen by the United Nations, the current Governing Council, the coalition and a select group of Iraqi judges, according to the U.N. spokesman's office in New York. Neither party nor ethnic affiliation would be a factor, the office said.

During his meetings in Iraq with political and religious leaders and many groups, Brahimi said there was wide support for convening a "national conference." He proposed the conference take place in July and elect an assembly to serve alongside the government until the election.

"I think this is indispensable in a country where for 30 years people were afraid to talk in front of their children — that they get together," he said. "I think that in itself will achieve a lot for the good of Iraq."

L. Paul Bremer (search), the chief U.S. administrator in Iraq, welcomed Brahimi's recommendations.

"We hope that the U.N. will continue to use its expertise to play a vital role in advising Iraq as it moves forward with its political transition," Bremer said in a statement.

In Washington, State Department spokesman Richard Boucher noted that Brahimi said "it is possible, it is feasible to establish an Iraqi interim government before June 30th," which is consistent with U.S. thinking.

"We have every intention of making that transfer," Boucher said. "We need to get started on the elections process as well."

A U.N. electoral team is in Iraq working on preparations for the general election.

Iraqi politicians and U.S. administrators have differed sharply over how to transfer power to Iraqis. That prompted the United States to abandon an earlier American plan to choose a government through local caucuses — and both sides to eventually turn to the United Nations.

Suggesting the Governing Council should cease to exist contrasts with Washington's earlier idea of expanding the 25-member body to include political parties and groups not now represented. That would have allowed the Governing Council to function as a sort of legislature until elections.

"I am absolutely confident that most Iraqis want a simple solution for this interim period," Brahimi told reporters. "You don't need a legislative body for this short period."

The demise of the council would not be mourned by many Iraqis. Its makeup — 13 Shiites, five Sunni Arabs, five Kurds, one Christian and one ethnic Turk — reflects the ethnic and religious makeup of the country, but many Iraqis viewed its members either as outsiders or as puppets of the Americans.

Brahimi also said security must improve "considerably" before any election.

Violence in Iraq this month has killed at least 87 U.S. soldiers and about 880 Iraqis — the deadliest month since the war began on March 20, 2003. Most of the deaths came in fighting in the Sunni city of Fallujah or in clashes between Americans and forces loyal to a radical Shiite cleric.

Brahimi has been in Iraq since April 5, his second visit to the country this year. He insisted Wednesday that U.N. and U.S. officials were cooperating, but criticized the U.S. military operation in Fallujah.

"Collective punishment is certainly unacceptable and the siege of the city is absolutely unacceptable," Brahimi said. But he also berated a reporter for failing to note the March 31 killings of four U.S. civilians in Fallujah and the mutilation of their bodies.