Around 290,000 seniors with limited incomes and assets will receive a HK$6,550 payout on April 5.
This is because the new HK$2,200 old-age living allowance will be backdated to December, when it was approved by the Legislative Council.
It replaces the HK$1,090 allowance - but recipients are restricted to singletons who earn less than $6,800 a month and do not have assets exceeding HK$193,000 and couples with a monthly income of HK$10,900 and assets not more than HK$290,000.
The new allowance will cost the government about HK$6 billion annually.
"The Social Welfare Department will this month issue a green notification letter with an attached reply slip to those who are eligible," director Patrick Nip Tak-kuen said yesterday.
Nip said asset declarations for new applicants have been kept simple to enable them to easily collect the payments.
Assets include land and non-owner occupied property, bank savings, stocks and shares, vehicles for investment and gold bars and coins.
"Exemptions are given to property in which the elderly are living, a columbarium niche for self-use in the future, and the cash value of insurance schemes," Nip said.
The department estimates there will be about 40,000 new applicants who are currently not receiving an old-age or disability allowance but who are in need of financial support.
They can send their applications by fax, e-mail, post or through referrals by government departments or nongovernment organizations. Money given by children or relatives is not considered income.
Because of this Lai Sup-yat, 77, said she will not put her savings in a bank account as she would lose the old-age allowance if her assets eventually exceed the limit.
"I would rather save the cash at home, maybe back to the old method of keeping my money in a mooncake box under my bed," Lai said.
The Hong Kong Elderly Service Association fears that many seniors may not be fully informed of the new means test and that this could lead to confusion. "Some have also changed their addresses and may not get the notification," a spokesman said.
He urged the government to dispatch more staff to explain the details to the elderly.
Wong Hung, a social work professor at the Chinese University of Hong Kong, said the HK$2,200 allowance is not enough to help the elderly living in poverty.
"Only a full-scale universal retirement protection system will effectively secure their living standards," he said.