Coronavirus latest: Fed’s Quarles cautions need to strengthen short-term funding markets

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Andy Bounds in Manchester and Sarah Provan in London

Greater Manchester is seeking an extra £90m in financial aid in return for tighter coronavirus restrictions as a noon deadline for talks with the UK government approaches.

Prime minister Boris Johnson has threatened to impose the “tier 3” category of restrictions unilaterally to curb a rise in infections that could overwhelm hospitals.

The government said that within two weeks all critical-care beds in Greater Manchester will be taken by Covid-19 patients and insists that it has offered local leaders a “good package” of £22m.

“The real risk is by the first week of November in the current trajectory there will be no ICU places left in Greater Manchester,” said Nadhim Zahawi, a business and industry minister. “All will be occupied by Covid patients,”. He added that over the next couple of weeks the region is in danger of a greater level of infections than in March and April.

The tighter rules would require all pubs to shut that cannot operate as restaurants, and stop households from mixing indoors or outside. Betting shops, casinos, bingo halls, adult gaming centres, and soft play areas are likely to close but not gyms, according to a letter from communities secretary Robert Jenrick, seen by the Financial Times.

But Andy Burnham, Labour mayor of Greater Manchester, struck a defiant note on Tuesday morning, telling BBC Radio 4’s Today programme that the deadline was “slightly provocative”. The mayor believes the region needs £15m a month to support those who would not be able to work and analysts believe restrictions would last until April, although they would be reviewed every four weeks.

“There is more to come if Andy wants to negotiate it to commensurate with what we have done with the Liverpool region and Lancashire,” said Mr Zahawi on Sky News on Tuesday. Those two regions received £30m extra for entering tier 3, which would equate to £56m for Greater Manchester, which has a higher population of 2.8m.

Mr Burnham and Richard Leese, leader of Manchester city council, on Monday said the government had removed from negotiations a previously discussed “hardship fund” that would have topped up furlough payments to those deprived of work by any tougher restrictions.

“The government could have a deal if it better protects low-paid people. It is choosing not to do that,” Mr Burnham told the Financial Times. The local leaders also accused the government of using “selective statistics” on hospital occupancy rates to bolster the case for tougher rules.

Mr Zahawi said regional lockdowns remained “the best way to deal with the resurgence of Covid 19”.

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