Government-backed loans worth £330 billion will be made available to support businesses through the coronavirus crisis, the Chancellor has announced.

Rishi Sunak said the unprecedented package - equivalent to 15 per cent of GDP - could go further if demand is greater, and vowed to do "whatever it takes" to help the economy.

The Chancellor, speaking at a press conference inside 10 Downing Street, also said he was extending the business rates holiday to all businesses in the hospitality sector and funding grants of up to £25,000 for smaller businesses.

And Mr Sunak said that for those in financial difficulty due to coronavirus, mortgage lenders will offer a three-month mortgage holiday.

He unveiled the measures after the Government's chief scientific adviser said around 55,000 people in the UK now have covid-19, as the NHS moved to cancel all non-emergency surgery and 71 people are now known to have died.

Sir Patrick Vallance told MPs it is hoped the death toll can be kept to under 20,000 as he told of the huge amount of strain the health service will be under from Covid-19.

Mr Sunak said: "This is not a time for ideology and orthodoxy, this is a time to be bold, a time for courage.

"I want to reassure every British citizen this Government will give you all the tools you need to get through this."

He said the Government would stand behind businesses small and large, and announced an "unprecedented package of Government backed and guaranteed loans to support business to get through this".

"Today I am making available an initial £330 billion of guarantees, equivalent to 15 per cent of our GDP.

"That means any business who needs access to cash to pay their rent, their salaries, suppliers or purchase stock will be able to access a Government-backed loan or credit on attractive terms.

"And if demand is greater than the initial £330 billion I'm making available today, I will go further and provide as much capacity as required. I said whatever it takes, and I meant it."

Describing the outbreak as an emergency, he added: "Never in peacetime have we faced an economic fight like this one."

Prime Minister Boris Johnson said the Government must and will act with a profound sense of urgency and would be like a wartime government.

The Prime Minister also warned that covid-19 is so dangerous that without drastic action it will overwhelm the NHS, as he warned that more extreme measures may be needed to protect lives in the future.

Westmorland and Lonsdale MP Tim Farron had called on the Government to give Cumbrian businesses whatever financial support is needed to deal with the escalating crisis just a few hours before the announcement.

In response to the Chancellor’s beefed up financial package, he said: “The devil is always in the detail, but this is an initially promising announcement especially for businesses in the hospitality sector which is so vital to the Cumbrian economy. 

“The crucial thing is whether these measures will lead to businesses having enough support to keep paying their staff.

“I will continue to put pressure on the Government to make sure that the 60,000 people that work in tourism and hospitality in Cumbria are given a secure future.”

The statement was also welcomed by regional law firm Napthens, although partner James Allison called for more innovative support for the leisure sector or risk losing thousands of jobs.

“We need to see forward-thinking, innovative strategies such as a relaxation of licensing laws so, for example, breweries, restaurants and other venues can sell and deliver direct to consumers,” he said.

“Has the Government got the appetite to help fund rent payments, or cancel duty on beer; will it look seriously at VAT and help smaller, independent operators like hotels and breweries?

“These new measures will certainly offer much-needed support, but the question remains of how speedily they are available to those who most need them. We will be interested to see the process and practical steps help on the ground to let businesses access this support.

“Lancashire and Cumbria in particular have so much to offer in terms of leisure and hospitality – but there is still not enough support on offer.”