The government announced on Monday that around 50,000 elderly people are to benefit by almost HK$1,000 in extra allowance each month from September as it shakes up how it supports needy elders.

The Old Age Living Allowance (OALA) is currently set at two tiers – at HK$2,920 and HK$3,915 – depending on an applicant’s monthly income and asset level.

But the two-tier system of support will be “merged”, with all those aged 65 and over who meet income and asset limits receiving the full monthly old-age living allowance of HK$3,915.

"The merger will reform the existing OALA scheme and support needy elderly persons more effectively, thereby providing them with more stable retirement protection arrangements," a government spokesman said.

The change was first proposed by outgoing Chief Executive Carrie Lam in January 2020.