Families can be reunited, dinner parties will be allowed and drinkers can enjoy a pint from July 4 as England’s coronavirus lockdown is eased – but millions of people will still be unable to hug their loved ones.

Boris Johnson said the “national hibernation” is beginning to end, and “life is returning to our streets” but warned that the virus was still not defeated and vigilance was required.

Under the changes, indoor gatherings involving two separate households will be permitted – including the possibility of staying overnight in homes, hotels or B&Bs – but social distancing will need to be maintained.

Where the two-metre rule cannot be applied it will be replaced with a “one metre-plus” measure, with the protection offered by the physical distance enhanced by other mitigation measures such as the use of face coverings, increased hygiene or layout changes in premises.

Mr Johnson acknowledged that the two-metre rule “effectively makes life impossible for large parts of our economy”.

The hospitality industry had warned that pubs and restaurants would go to the wall if the measure remained in place.

The Prime Minister said “difficult judgments” had to be made and “every step is scrupulously weighed against the evidence”.

He added: “Our principle is to trust the British public to use their common sense in the full knowledge of the risks, remembering that the more we open up, the more vigilant we will need to be.”

From July 4, two households of any size will be permitted to meet in any setting – inside or out.

“It will be possible to meet one set of grandparents one weekend, the others the following weekend,” he said.

As large parts of the economy reopen:

– Pubs and restaurants will be limited to table service and will be asked to collect customers’ details so they can be traced if there is a coronavirus outbreak.

– Hairdressers will be able to reopen with precautions including the use of visors.

– The domestic tourist industry will be boosted by the reopening of accommodation including hotels, B&Bs and campsites along with most leisure facilities and attractions such as theme parks.

– Outdoor gyms and playgrounds will be returned to use.

– Cinemas, museums and galleries will be allowed to open their doors again.

– Places of worship will reopen, with weddings of up to 30 people allowed – although any receptions afterwards would be severely limited as only one other household would be allowed to join the bride and groom.

However “close proximity” businesses including nightclubs, soft play centres, indoor gyms, nail bars and beauty salons will remain shut as will bowling alleys and water parks.

Live performances at concert halls and theatres are also still banned, partly due to the risk posed by singing in spreading the virus.

Mr Johnson said the measures will help restore a sense of normality after “the toughest restrictions in peacetime history”.

He told MPs: “Today, we can say that our long national hibernation is beginning to come to an end and life is returning to our streets and to our shops, the bustle is starting to come back and a new, but cautious, optimism is palpable.”

But he said the virus has not gone away and the Government “will not hesitate to apply the brakes and re-introduce restrictions – even at national level – if required”.

In other developments:

– First Minister Nicola Sturgeon said the two-metre rule would remain in place in Scotland.

– The total number of deaths in the UK involving Covid-19 has risen to more than 54,000 according to PA news agency analysis.

– The number of new infections is now declining by between 2% and 4% every day, Mr Johnson said.

– The Government announced it was scrapping its daily press conferences, although the Prime Minister was still expected to face the media at Tuesday’s session.

Responding to Mr Johnson’s statement in the Commons, Labour leader Sir Keir Starmer said the Government was “trying to do the right thing and in that, we will support them”.

But “any unlocking carries risks” and “it has to phased, managed and carefully planned”.

CBI director general Dame Carolyn Fairbairn said: “The long and nervous wait for hoteliers, landlords and restaurateurs is now nearing an end.

“It will also be a joy that our cultural centres can slowly return to life.

“Easing social distancing rules will make a material difference to the viability of thousands of firms.”