The UK government says it will pay two thirds of the salaries of workers in companies that have to close as a result of new coronavirus restrictions widely expected to come into effect next week.
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In a change of policy, Treasury chief Rishi Sunak has responded to calls from businesses, local leaders and unions to provide a financial support package to prevent mass job losses in sectors that will be subject to new restrictions.
Pubs and restaurants in large parts of the north of England, where the coronavirus is spreading fastest, are expected to face a government order to shut their doors again - barely three months after reopening.
Restrictions are already being tightened on Friday in Scotland, where pubs in the two biggest cities, Glasgow and Edinburgh, have to close for 16 days.
"I have always said that we will do whatever is necessary to protect jobs and livelihoods as the situation evolves," Sunak said.
"The expansion of the Job Support Scheme will provide a safety net for businesses across the UK who are required to temporarily close their doors, giving them the right support at the right time."
The virus hot spots around England, such as the big northern cities of Liverpool, Manchester and Newcastle, are expected to face new restrictions that could affect hundreds of thousands of jobs.
Under the terms of the new program, the government will pay 67 per cent of the salaries of workers who won't be able to work, up to a maximum of 2100 pounds ($A3790) a month.
Employers will not be required to contribute towards wages.
Sunak said cash grants for businesses required to close will also be increased to up to 3000 pounds per month.
Businesses will only be eligible to claim the grant while they are subject to restrictions and employees must be off work for a minimum of seven consecutive days.
The changes will take effect from November 1 and will be available for six months, with a review in January.
Sunak would not be drawn on what businesses would be forced to close but said the rise in cases and hospital admissions in certain parts of the country is a "concern" that necessitates a change in approach.
A more generous UK-wide program will expire at the end of October.
At the height of that program, the government paid 80 per cent of the salaries of furloughed workers, keeping a lid on unemployment.
That is being succeeded by the less generous Jobs Support Scheme, which will have the government pay up to 22 per cent of wages for workers who return to work from their furlough from November 1.
Australian Associated Press
