Pubs and restaurants and other businesses ordered to close in areas in hardest-hit regions will be able to claim for two thirds of wages for staff put on furlough.
Manchester, Liverpool and other areas of the North are expected to go into harder lockdown early next week, once the government launches its new traffic-light system for dealing with coronavirus outbreaks.
London is expected to follow shortly, following a warning from Mayor Sadiq Khan.
Although the government is expected to cover 66 per cent of staff wages, it is still short of the 80 per cent the hospitality sector had been calling for.
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Every business in the UK is eligible for the Jobs Support Scheme from November, which covers one third of the wages for staff on days they are not working due to coronavirus. Business owners cover the other 33 per cent on days not work, with employees taking a one-third pay cut.
What that means in actuality though is, if an employee is working the minimum one third of their usual hours, then the government is only covering 22 per cent of their wages.
Critics have pointed out that it would be cheaper for a small business to keep on one staff member full time than to retain three part-time workers through the scheme.
Covid expected to cost small businesses £69bn