The Irish Independent reports that there has been a surge in the number of people saving in banks and credit unions.

And the number squirrelling away money is likely to jump again, as banks gear up to pounce on a payout of more than €600m in lump sums to public servants who are retiring this month.

Almost half of Irish people have got enough spare cash to allow them to save regularly, a new survey shows.

The number of people saving on a regular basis was up 8pc in January, according to the Nationwide UK (Ireland)/ ESRI savings index.

The percentage of people not saving fell by 6pc to 31pc in January compared with December.

Savers were also more positive about the current environment for keeping their cash, with more than one-third saying it was a good time to save.

The most recent statistics from the Central Bank show that households have €91.3bn in savings in banks, after they salted away an extra €540m in bank accounts in December compared with the previous month.

This figure is expected to surge by the end of this month when an estimated €630m from the payment of tax-free lump sums to retiring public servants is handed out.

Retire

Some 8,000 public servants are set to retire at the end of this month as part of the government's plan to cut the numbers in the public service.

Jerry Moriarty of the Irish Association Pension Funds estimates that the average lump sum will be close to €80,000.

Senior people retiring are set to get even more, with retiring high-ranking gardai in line for lump sums of an average of €107,000.

Financial advisers warned savers yesterday that banks were monitoring their customers' accounts and anyone getting a large amount of cash would be targeted for product sales attempts.

Karl Deeter of Advisors.ie said: "Banks will monitor lump sums coming into accounts and will try to sell bank products like life assurance and investment products loaded up with fees for the bank to anyone coming into a large sum of money."

He advised anyone with a lump sum to get independent financial advice before taking the advice of a bank. Savings rates continue to be attractive, he said.

Depositors are being offered interest rates of up to 4.1pc by EBS for those prepared to put money away monthly, while lump sums can attract rates as high as an annualised 4.52pc for money deposited in an Investec fixed-term account.

An Post pays an annualised rate of 3.29pc for the four-year savings bonds, with no deposit interest-retention tax deducted.

The Irish Independent also reports that the insurance levy created to fund the collapse of Quinn Insurance could be imposed for longer than expected after estimates for the cost of paying the insurer's debts rose by another €37m.

The Irish Independent has learned that the insurer's administrators recently admitted they expect to need €775m from the Insurance Compensation Fund (ICF) to deal with Quinn Insurance's claims.

When the call on the ICF was first announced back in September the administrators expected to need about €600m. That figure was later revised upwards to €738m.

Sources last night admitted that the €775m might not be the final figure, but said that there should be much more clarity in about two years when the bulk of the old claims will have been dealt with.

The ICF money is being used to plug the gap between the claims left with the 'old' Quinn Insurance and the assets that the administrators still control.

The claims involved are largely UK and commercial business that wasn't included in Liberty Mutual and Anglo Irish Bank's takeover of the 'main' Quinn Insurance business last year.

Predict

Because claims are being settled on a daily basis, and the estimates for future claims are continuing to evolve, it is impossible to precisely predict how much ICF money will be needed.

The ICF fund is paid for through a 2pc levy on all general insurance policies sold in the Republic of Ireland.

The Department of Finance last night confirmed that the levy would stay fixed at 2pc.

But this implies that consumers will be paying the levy for a longer time to meet the higher figure of €775m.

Rough calculations predict that the levy will raise about €65m a year, though that figure will vary depending on the price of insurance premiums and the level of cover taken by people.

At €65m a year, it would take almost 12 years to pay off the full €775m. The insurer's administrators will need the money faster than the ICF levy can raise it, so the Government will pre-fund the scheme.

The Irish Times reports that tax incentives aimed at luring senior multinational executives to Ireland, in a bid to boost job creation, will feature in the Finance Bill which is due to be published today.

The special tax breaks are aimed at so-called project champions who would relocate to Ireland to oversee significant investments and will apply to indigenous as well as multinational firms.

Top-earning executives have reportedly been less keen to locate here following increases in income taxes in recent years which have brought the marginal rate to 52 per cent for PAYE workers.

While it is unclear at what income level the new relief would kick in, the financial services industry has been lobbying for a low threshold so that it would apply to entire project teams and not just the most senior executives.

The Special Assignee Relief Programme was flagged in last December’s budget by Minister for Finance Michael Noonan.

A Government source said yesterday the tax breaks were required to ensure high-earning individuals who could play a vital role in job creation were encouraged to come to Ireland. The tax breaks are designed to tie in with incentives to encourage the expansion of research and development and intellectual property projects in Ireland.

“The incentives are there for the appropriate specialised job creation initiatives but we also need to have tax incentives to ensure that the right people who can develop these kinds of projects come to Ireland,” said the Government source.

He emphasised that the incentives would only apply to people involved in new product development and could not be availed of by people already working here.

The qualifying individuals will have a significant proportion of their salaries exempt from tax.

The scheme will be a boost to the International Financial Services Centre although the Government says it is not designed to lure highly paid London bankers to Dublin.

In theory the new jobs created should more than compensate for the tax forgone.

The Government signed off on the Finance Bill yesterday and it will be published today. It is expected that the Bill will also deal with the concerns raised by the judiciary about the tax treatment of their pension pots on retirement. These concerns were raised by former chief justice John Murray in a meeting with Taoiseach Enda Kenny last year.

Because of changes in recent years in the way the cost of pensions of senior public servants has been calculated, judges could face significant lump-sum tax payments on the day they retire. This will apply in cases where judges have contributed significant sums to private pensions in the years before they were appointed to the bench.

A senior judge told The Irish Times last year that a High Court judge with “a relatively modest pension” from private practice could face a lump-sum tax bill of more than €400,000 on the day he or she retires. Such a bill would be greater than the lump-sum tax-free payment of 1½ times salary judges would receive on retirement.

It is expected that some measure of amelioration designed to spread the tax bill over a number of years will be introduced to deal with the concerns raised by the judiciary.

While the overall tax bill to be faced by judges following retirement is unlikely to be changed in any significant way, the Bill is likely to deal with the problem of a massive tax bill at the point of leaving the bench.

The Irish Times also reports that the National Asset Management Agency has spent €27.55 million on legal expenses since it was established just over two years ago, with the Dublin-based law firm Arthur Cox the highest paid to date.

A total of €16.46 million was expended on legal fees to Irish and international firms last year, €9.75 million in 2010, and more than €1.35 million so far this year.

Arthur Cox, the State’s biggest law practice, has received €3.07 million from Nama so far; €1.9 million in 2010 and €1.16 million in 2011.

The international legal firm Hogan Lovells has earned €2.93 million to date. The London practice Allen Overy received €2.47 million.

The figures were sent by Nama chief executive Brendan McDonagh to Sinn Féin leader Gerry Adams, who in a parliamentary question sought a breakdown of the “top 10” recipients of legal fees.

“After a full year of Fine Gael and Labour in Government, the only people who appear to be benefiting from Nama are the legal and accounting professions,” Mr Adams said.

The remaining firms in the top 10 were Maples and Calder (€2.05 million), Matheson Ormsby Prentice (€1.58 million), Byrne Wallace (€1.51 million), William Fry (€1.45 million), AL Goodbody (€1.37 million), Dillon Eustace (€1.19 million) and Beauchamps (€1.17 million).

Mr McDonagh’s response to Mr Adams also said Nama had recovered €10.14 million of the €27.55 million paid to date from the financial institutions as it related to due diligence on loan acquisition.

A spokesman for Nama said the organisation had saved the State a large multiple of the legal costs incurred. “The legal costs incurred in 2010 and 2011 relate to legal due diligence conducted on loans which Nama acquired from the participating institutions,” he said.

“Arising from these reviews, questions were raised about the enforceability of security in certain cases, and as a result legal discounts amounting to €368 million were imposed; this reduced correspondingly the acquisition cost of the loans.” This related only to the first five tranches and the value of discounts applied in later tranches was currently being quantified, he added.

Nama was established on December 21st 2009.

The Irish Examiner reports that transition teams to oversee a smooth delivery of services when thousands of public sector workers retire at the end of this month have not yet been formally established, the Taoiseach has admitted.

This is despite his claim in an RTÉ interview last Sunday that the high-level teams are "in place" to avoid chaos when hospital staff, teachers and gardaí retire over the coming weeks.

Asked about the status of the transition teams just three weeks before the exodus of staff is due to be complete, Enda Kenny told the Dáil that they would be "approved by Cabinet next Tuesday".

His apparently conflicting remarks prompted Fianna Fáil to claim that the Government was not prepared for the drop in public sector staff numbers.

FF party leader Micheál Martin said the transition teams were a "figment of his imagination" and "invented on Sunday because it sounded good" for RTÉ.

Speaking in the Dáil, Mr Martin asked if there was a plan in place to deal with the potential service chaos.

Referring to an admission by Health Minister James Reilly that some elective surgery would be postponed because the effect of staff departures, Mr Martin asked why there was a "drip feed" of information about the possible problems arising from the early retirements.

Mr Kenny said details of the actual numbers leaving each department had not "crystallised until the last few days" and "the figures didn’t really become clear until very recently".

The Government had expected that 9,000 people would retire early because of the new pension arrangements, which come into effect in March.

However, Mr Kenny said the latest figures indicated that 6,600 people planned to retire before the end of February.

This included 1,008 civil servants, 2,263 in the health sector, 2,000 in education, 859 in local authorities, 241 in the Defence Forces, and 297 gardaí. He said discussions on the transition arrangements had been going on "for quite some time, but in the absence of accuracy of figures".

It is understood that, last Wednesday, a Cabinet sub-committee discussed the possibility of putting transition teams in place for the health service and the Taoiseach expressed the view that if they could work in health, they should work elsewhere.

Yesterday, he told the Dáil that five such teams would be set up to cover the health, education, justice, local government, and civil service sectors.

"By next Tuesday the transition teams, and the way that they’re going to manage the business in each of these sectors, will be presented by the minister for public sector reform in a memo to Cabinet," he said.

Independent TD Finian McGrath said that an "emergency crisis" loomed in the health service as a result of the staff reductions.

Mr Kenny replied that it was "virtually impossible to know what situation might arise in any individual hospital at any one time. That’s life and that’s reality."

He said the teams would focus on managing the reduced staff "so that the crisis and catastrophe that some people predict won’t become a reality".