Who will blink first in the battle for the North?

Andy Burnham insists his standoff with the Government is “not about a big cheque”. Nonetheless, a hefty sum will inevitably be required to end the impasse over financial support for Greater Manchester after it was moved into the highest tier of Covid restrictions amid a rise in infections.

“We need to agree a package of support that will help people through this,” Burnham, the region's mayor, told the BBC’s Andrew Marr Show on Sunday. “It’s discriminatory for people in the lowest-paid professions to have a two-thirds furlough when people on middle incomes were paid 80pc earlier in the year.”

Tier 3 rules mean pubs and bars have to close, on top of a range of other restrictions on enterprise and day-to-day life. As well as calling for the 80pc wage subsidy to be restored for all affected workers, including the self-employed, Burnham wants “a proper compensation scheme for businesses”.

The British Chambers of Commerce backed his plea, telling the Prime Minister any new lockdown restrictions must come with "truly commensurate" financial support or risk "catastrophic economic consequences".

The Government, meanwhile, is urging Burnham to accept an offer believed to be worth tens of millions of pounds. Robert Jenrick, the communities secretary, said on Monday that "every side needs to now come together and reach an amicable conclusion for the sake of people in Greater Manchester."

On Monday evening Mr Jenrick gave local leaders a deadline of noon on Tuesday to reach a deal, or the Government would push Greater Manchester into Tier 3, the Financial Times reported.

But has Whitehall coughed up enough cash?

Across the 10 council areas in Greater Manchester, 1,809 pubs and 143 wine bars would have to close under Tier 3 restrictions, according to analysis by Altus Group, the real estate adviser.

The trade body UKHospitality estimates that 29,000 jobs would be at risk. On average, those staff would have worked 35 hours a week at £8.50 an hour.

Increasing government support to 80pc for these workers would cost more than £1m a week, according to Telegraph calculations.

If the same restrictions are applied in Greater Manchester as have been applied to the Liverpool City region and Lancashire, 400 betting shops and 12 casinos would also have to shut, according to the Betting and Gaming Council (BGC).

They employ 3,000 people and pay more than £80m a year in tax, while betting shops pay £12.5m in levy and media rights payments annually, the BGC calculates.

“The deputy chief medical officer visited one of our casinos and made it clear the anti-Covid measures were better than in other parts of the hospitality sector,” a spokesman claims.

“Last week, Sage [the Government’s expert scientific advisory group] acknowledged that high-street retail – like betting shops – have a ‘very minimal impact’ on the spread of Covid.

“But if they are forced to close, those making decisions must come up with a financial package to ensure they have a long-term future.”

A further 252 gyms and leisure facilities – 153 of which are privately run – could close if the Liverpool City region's rules were applied to Greater Manchester. They employ 3,000 people, and would lose about £5m a week in income, the trade group UK Active says.

Overall, a rough analysis by the Centre for Cities estimates that Burnham’s furlough scheme would cost at least £7.6m a week more than what is currently available, although this does not account for the self-employed or other indirectly affected players in the supply chain.

Elena Magrini, a senior analyst at the think-tank, says despite the cost, it supported the increase. "It would make a large difference for many lower income workers who could be left in financial difficulties as a result of these new restrictions and may help lessen the long-term damage done to Greater Manchester's economy," she adds.

In other regions where local leaders are asking for financial deals in exchange for tougher restrictions, such as South and West Yorkshire, councils are asking for more support for businesses and workers – but not for an 80pc furlough package.

Treasury sources said the Chancellor Rishi Sunak would not get in the way of a deal, but said he would not cave in to Mr Burnham's demand for a return to the 80pc wage subsidy of the original furlough scheme for people whose workplaces are forced to close.

In the battle for the North, one side is going to have to blink first.