A local lockdown being imposed on Oldham is a “very real threat”, the council leader has said, as he warned that further restrictions could be “catastrophic” for businesses.

Labour councillor Sean Fielding told reporters that a local lockdown, which has not been ruled out by the Health Secretary, was being considered by the Government.

Mayor of Greater Manchester Andy Burnham said that he would be writing to Matt Hancock on Wednesday afternoon to say there is “no case” to impose further restrictions on the town.

Oldham currently has one of the highest rates of new Covid-19 infections, despite being within an area which has restrictions to prevent households from mixing indoors.

During the virtual press conference on Wednesday, Mr Fielding said that local authorities were “resisting” a local lockdown.

“We’ve had communication from Government that it’s something that is genuinely being considered,” he told reporters.

“So, it is very real. It is a very real threat for Oldham, make no mistake at all, but we are resisting it strongly for all of the reasons that I’ve set out today.”

He said that the virus was “predominantly” spreading through households as opposed to in care settings, caused by high levels of deprivation, low-wage employment and crowded living conditions.

“Closing down non-essential businesses in Oldham would not change that, it would not solve that problem,” he added, warning that the economy is “fragile” and had not recovered from the national lockdown.

“To inflict a further close down of the economy would be catastrophic for us and that’s why we are resisting it strongly,” he told reporters.

Figures for the seven days to August 15 showing a rate of 83.1 new cases per 100,000, a decrease from 109.7 in the seven days to August 8, with 197 new cases.

Save the Children said the town has the highest rate of child poverty in England and warned deprivation could soar if there is a local lockdown.

The charity, which is calling for a boost of £20 a week to the child element of Universal Credit and Child Tax Credit, said children in Oldham are six times more likely to be living in poverty than those in wealthier areas of the country.

Earlier on Wednesday, Mr Hancock did not rule out a local lockdown in the town, telling Times Radio that the Government will do “what is necessary” while working closely with the council.

“There is a big challenge in Oldham, the numbers are clear about that,” he said.

Mr Burnham told reporters at the virtual press conference that he would be writing to Mr Hancock to say that measures in Greater Manchester were working.

Parts of northern England are currently subject to restrictions brought in at the end of July to prevent households from mixing indoors following a rise in cases.

“We believe we can say with credibility that the strategy is working,” Mr Burnham told reporters.

“It is highly targeted, it is proportionate, and we believe that the case is made to continue what we are doing, to see if we can then create a further decrease in the coming days.

“So there is certainly no case today to impose further restrictions on Oldham beyond the prohibition of social gatherings in the home.”

He is also calling for businesses such as beauty parlours and casinos to be permitted to reopen across Greater Manchester, except in Oldham, in line with an easing of coronavirus restrictions in England.

Meanwhile, Labour MP Jim McMahon wrote to Mr Hancock asking for a further two weeks to see the impact of local interventions without the “blunt tool” of a lockdown.

The letter, which the MP for Oldham West and Royton posted on Twitter,  was co-signed by fellow local MP Debbie Abrahams and Labour deputy leader Angela Rayner.