Manchester will discover this week if it has won government backing to become the first city outside London to charge drivers for entering and leaving its borders.

Transport Secretary Ruth Kelly is due to announce whether she will give financial backing for a dual ring charging zone for the northwestern conurbation as part of a 3 billion pound scheme to improve local public transport.

Media reports at the weekend said Kelly would tell parliament on Monday she was agreeing to the plan, which faces opposition from local business groups who say it will damage the city's economy.

A Department for Transport spokesman would only say that a decision would be announced during the early part of the week.

The scheme, proposed by the Association of Greater Manchester Authorities (AGMA), would charge drivers up to five pounds a day for entering and leaving the city during peak hours.

Vehicles travelling in the opposite direction during peak hours would face no charge, as would anyone driving in and out of the city outside rush hours. Driving within the zones would remain free.

Drivers would pay two pounds to enter an outer cordon around the M60 motorway which circles the city, and a one pound to go back across it, with a further one pound to enter and leave an inner city zone.

To finance the scheme AGMA has submitted a bid for 1.2 billion pounds from the government's Transport Innovation Fund - designed to support road charging schemes - and plans to borrow a further 1.8 billion pounds over 30 years.

The money would be spent improving local transport with the charging zones coming into force by 2013.

"We risk losing 30,000 jobs over the next 10 years if we don't do something about congestion," Manchester Central MP Tony Lloyd told BBC television on Sunday.

But more than 100 local businesses have combined as the Greater Manchester Momentum Group to oppose the charging plans, which they say are an opportunist way to attract government funding.

"The congestion charge would unfairly penalise businesses and their employees as well as hindering investment in Greater Manchester and affecting its reputation as a world-class commercial centre," it said.