Government talks with authorities in the north east about moving into Tier 3 coronavirus restrictions have been paused, it is understood.
Tees Valley and Tyneside had been among several regions in negotiations with ministers about introducing the harsher social distancing rules, but they have been put on hold.
Infection rates in the region are continuing to rise in some parts, however.
Redcar and Cleveland, Stockton-on-Tees, Darlington, Middlesbrough and Hartlepool in the Tees Valley all saw an increase in their rates of infection per 100,000 residents in the last week, according to Government data analysed by the PA news agency.
Numbers have dropped in some boroughs in the Tyneside area, including the city of Newcastle upon Tyne, South Tyneside and North Tyneside.
Local leaders in the Tees Valley have said they “cannot let the Government off the hook” when it comes to supporting businesses and communities that have to go into the High classification.
Speaking on behalf of the leaders of Redcar and Cleveland, Stockton, Darlington and Hartlepool Borough Councils, the Mayor of Middlesbrough and the Tees Valley Mayor, Councillor Mary Lanigan said: “If we have to be in restrictions so as to prevent the spread of the virus and to save lives then we need the money from government to support our amazing local people and businesses too.
“We will continue to press them to provide additional funding to support businesses in our region which are already feeling the impact of Tier 2 restrictions, especially those in our amazing hospitality sector.”
The statement comes after leaders in Greater Manchester were embroiled in discussions with ministers for more than a week about what financial support the region would receive when it goes into Tier 3 at the end of the week.
The leaders added: “There is clear evidence that the spread of the virus has slowed in the majority of areas in the north of the North East region, which all went into Tier 2 restrictions some weeks before the Tees Valley.
“This is encouraging and we need to see the effect in our region before any further restrictions are considered.”
This week discussions have also taken place about moving Nottinghamshire and West Yorkshire into the highest category of restrictions.
Tier 3 would see the closure of bars and pubs that do not serve substantial meals, as well as more curbs on socialising in indoor and outdoor settings.