Financial Secretary Paul Chan announced on Wednesday that the government will give all adult permanent residents of the city HK$10,000.
In his budget speech, Chan said although he expects a decline in revenue in the coming year due to the economic downturn, he believes the government should do a bit more as the city faces an economic setback and is "overwhelmed by a heavy atmosphere."
"After careful consideration, I have decided to disburse HK$10,000 to Hong Kong permanent residents aged 18 or above, with a view to encouraging and boosting local consumption on the one hand, and relieving people's financial burden on the other," Chan said.
"This measure, which involves an expenditure of about HK$71 billion, is expected to benefit about seven million people. The government will announce the details of the scheme as soon as possible after obtaining funding approval from the Legislative Council."
Chan said he wanted to emphasise that although the handouts will involve a "huge sum of public money", it's an exceptional move taken in light of the current "unique circumstances".
Various political parties from both the pro-establishment and pro-democracy camps had called for such handouts.
In 2011, the government provided residents with cash handouts of HK$6,000. The registration scheme to get hold of the money got underway around half a year after the move was announced by the then-financial secretary, John Tsang.