U.S. spy agencies will no longer hold American’s phone records according to an announcement today by President Barack Obama. The directive will end part the controversial Section 215 metadata program that has been the source of constant discussion over the past six months. President Obama announced his decision in a speech this morning at the Justice Department and also issued a presidential policy directive outlining his plans for changes in the intelligence community.

“Critics are right to point out that without proper safeguards, [Section 215] could be used to yield more information about our private lives,” Obama said. He also concluded that opposition to the program, and other NSA activities, were also correct because even though the NSA has been subject to oversight, it has never been subject to “vigorous public debate” until Edward Snowden, former NSA contractor, leaked information about the intelligence community to global media outlets in 2013.

Changes to the program will come in two parts and work as a transition for the government. Effective immediately, the intelligence community will only be able to query phone numbers that are twice removed from a known terrorist agent—instead of the former three-steps removed—to be investigated. The president has also directed the attorney general to work with the Foreign Intelligence Surveillance (FISA) Court so that during the transition period, the database can only be queried after a judicial finding, or in a true emergency.

The second phase of the transition will be taken on by the intelligence community and the attorney general to develop options for a new program that can match the capabilities and fill the gaps that the Section 215 program was designed to address without the government holding the metadata.

Obama said that he will meet with the intelligence community to develop new options of approach on whether private companies, or a third party, should hold metadata information. However, he expressed concern about a third party maintaining control of the information as it would “be carrying out government function with more expense,” more legal ambiguity, and less accountability. He also noted that such a move could negatively impact public confidence.

The deadline for the intelligence community to develop an alternative for the storage of metadata is March 28, 2014, the date when Section 215 is to be reauthorized by Congress. Obama said he also intends to consult with Congress to hear their views before making a final decision on metadata storage.

Also in his speech this morning, Obama issued directives to make changes to the FISA Court, ordering the director of national intelligence, in consultation with the attorney general, to annually review any future opinions of the court with broad privacy implications for declassification, and to report to the president and Congress on these efforts. In addition, Obama called on Congress to authorize the creation of a panel of advocates from outside the government to provide an independent voice in significant cases before the court.

Another key point in Obama’s speech was the need to win back the trust of American allies. His administration will attempt to make strides towards regaining that trust by laying out the principles of how the United States uses intelligence gathering abroad, including making provisions about only gathering information related to counterintelligence, counterterrorism, counter proliferation, cybersecurity, force protection for troops and allies, and combating transnational crime, including sanctions evasion.

Obama also said that unless there is a compelling national security purpose, the intelligence community will discontinue monitoring the communications of heads of state and government of “our close friends and allies.” However, Obama did not define who falls into this category and made no exceptions for leader’s aides.

His remarks come one month after the release of the President’s Review Group on Intelligence report, which recommended more than 40 changes at the NSA in its 300-page report. The five-member review group testified earlier this week before Congress in a Senate Judiciary Committee hearing to explain the report’s findings.

In its report, the review group concluded that the NSA’s phone record metadata program has not been essential, saying “the information contributed to terrorist investigations by the use of section 215 telephony metadata was not essential to preventing attacks and could readily have been obtained in a timely manner using conventional section 215 orders.”

The report also said that Section 215 has generated relevant information in only a small number of cases and there has been “no instance in which NSA could say with confidence that the outcome would have been different without the section 215 telephony metadata program.”

Moving forward, Obama said that the White House will designate a senior official to implement safeguards to ensure that the directives he issued are being implemented. He also intends to have a comprehensive review with security and privacy experts to review big data and privacy. To read the White House fact sheet about the policy directives issued today, visit the White House’s Web sitehere.