Greater Manchester has been left in limbo after a midday deadline passed to reach a deal with the government over moving to tier three Covid rules.
On Tuesday, the region’s mayor, Andy Burnham, said the area was still seeking a “fair figure” of support.
The BBC understands council leaders in Greater Manchester are arguing for a minimum of £75m from the government.
Communities Secretary Robert Jenrick had suggested the PM could impose top tier measures if no deal was agreed.
The “very high” alert level – also known as tier three – would mean closing pubs and bars which do not serve meals, and additional restrictions on households mixing.
The government and local leaders – including mayors and MPs – have been embroiled in 10 days of talks over moving Greater Manchester’s 2.8m population from tier two to the highest restrictions.
Local leaders in Greater Manchester have been calling for greater financial support to help those who would be affected by tier-three restrictions.
Currently, the new Job Support Scheme covers 67% of the wages – covered by employers and the government – of people affected by tier three closures, as opposed to the 80% offered during the UK’s first lockdown.
Earlier, Mr Burnham BBC Radio 4’s Today programme he would advise local leaders to set out their request to the government for extra financial support in a letter.
He said: “I think it is fair to recognise that if you put a place under restrictions for as long as we’ve been under restrictions it grinds people down. It pushes businesses closer to the brink.”
But Chancellor Rishi Sunak told the Commons that Greater Manchester was “being treated exactly the same as every part of our United Kingdom”.
The chancellor reiterated that there was a “national funding formula” of £8 per head for all local authorities entering tier three.
Business minister Nadhim Zahawi told Today £22m had been offered to Greater Manchester – equivalent to £8 per person – and there would be “additional support commensurate with what we have done in Liverpool City Region and in Lancashire”.
It come as the number of weekly registered coronavirus deaths in England and Wales rose by 438 and increased by a third in the space of seven days, according to official figures from the Office for National Statistics.
Mr Burnham also said he would not “break the law” if no agreement was reached between both sides and the government imposed tier three measures on Greater Manchester.
“It’s their prerogative to do what they think is needed,” he told BBC Breakfast.
“But I would say to them that I don’t think it will help us bring people with what they want to do to control this virus. I think it would be better to come to an agreement.”
A three-tier system of alerts was announced a week ago in an attempt to control rising coronavirus cases without a UK-wide lockdown.
So far, only the Liverpool City Region and Lancashire have been moved into tier three.
However, Health Secretary Matt Hancock told the House of Commons on Monday that discussions are planned for South Yorkshire, West Yorkshire, Nottinghamshire, north-east England and Teesside also moving into the top tier.
Speaking ahead of those discussions with government, Nottingham City Council leader David Mellen said he would make clear “that we want a package that properly protects local people, businesses, jobs and education, whether it’s for tier two or tier three”.
Elsewhere in the UK, in Wales people will be told from Friday to stay at home, while pubs, restaurants and non-essential shops will shut, as part of a “short, sharp” national lockdown until 9 November.
A two-week school closure has begun in Northern Ireland as part of a tightening of restrictions.
In Scotland, the tightest restrictions are in place in the central belt, and there are plans for a three-tier framework of measures, similar to England’s.
On Monday, government figures showed the UK recorded a further 18,804 coronavirus cases and 80 deaths.