Chancellor Rishi Sunak said the move was an expansion of the Job Support Scheme, which is due to replace the eight-month furlough regime from 1 November.

“It is specifically to protect the jobs of those people who work in businesses that may be asked to close,” added Sunak. “If that happens, then those workers will receive two-thirds of their wages during the time they are unable to go to work.

“I hope this provides reassurance and a safety net for people and businesses in advance of what may be a difficult winter.”

The government is expected to announce new restrictions in some areas of England on Monday (12 October) - discussions with local leaders are set to go on over the weekend about these plans.

Sunak said the new initiative to pay 67% of wages for workers would apply to any businesses which are “formally or legally asked to close” by the government.

This is mainly expected to affect hospitality businesses, including pubs, bars and restaurants, which may be required to close in some parts of England that have seen rapid increased in Covid cases.

The new arrangements will also give affected firms in England greater access to grants, worth up to £3,000 per month, if they are forced to close their premises by the government’s new Covid restrictions over the next six months.