NSW has recorded 239 new cases, with around 70 infectious in the community.
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"Things are likely to get worse before they get better," Premier Gladys Berejiklian said.
Those who live in eight local government areas must now wear a mask "as soon as they step outside their door".
And the 10km radius introduced for those locked-down areas of concern yesterday is now at 5km.
Police are being given the power to close a workplace if a "flouting" of public health orders is observed.
Commissioner Mick Fuller said too many complaints of people breaching orders, and police observations, had prompted him to seek additional powers from the government.
"We know the numbers are too high today," he said.
"The powers particularly will focus on those people who are not doing the right thing."
Commissioner Fuller believed the Delta strain was "exposing non-compliance" that was there last year, but having a bigger impact, and said "nothing is off the table" when asked about a Sydney ring of steel.
"Pre-Delta, infectious rates were so low the need for police was certainly removed," he said.
"But we are seeing non-compliance at a level that is impacting on the virus and impacting on Sydney and NSW coming out of lockdown."
There have been two deaths reported; a woman in her 90s who was not vaccinated died yesterday morning and a man in his 80s died that afternoon and was also unvaccinated.
"At this level of cases, we are going to continue to see further deaths," Chief Health Officer Kerry Chant said.
"Sadly, too many elderly people in our community are not protected."
Dr Chant said 25 per cent of people over 70 are still yet to receive a first dose of COVID-19 vaccine, based on federal stats.
"I don't think you need more evidence vaccines save lives and COVID will kill."
NSW has 182 cases in hospital and "many of the cases are young".
A fully vaccinated Royal Prince Alfred Hospital worker, who did not have any symptoms, has tested positive.
There is a positive detection of viral fragments in Armidale, but there is a person there who is no longer infectious, and a contact is being followed up who is also residing in Armidale who has previously tested negative.
Ms Berejiklian was asked pointedly about whether her government's strategy had failed, given National Cabinet is expected to decide today that short, sharp lockdowns are the preferred response.
"We have harsher restrictions in place than any other state has ever had," she said.
"If you compare our mobility data to when Melbourne was in lockdown, the vast majority of our citizens are doing the right thing.
"But as we know, the Delta strain is a complete game-changer.
"We can take some comfort in the fact that today, we haven't had thousands and thousands of cases.
"The vaccines work ... touch-wood, I'm yet to be advised of anyone in intensive care, who's had both doses of the vaccine and based on that ... it's a call to arms. Please come forward and get vaccinated."
The Premier announced yesterday greater Sydney's lockdown would continue, as well as regional restrictions as the now-second-highest case tally for this outbreak of 177 was recorded.
Investigations continue into a new Victorian case in a traffic controller who was at a testing site - the remaining six local cases are all linked to current outbreaks and were in quarantine during their infectious period.
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