MercoPress. South Atlantic News Agency

Lula's top advisor, first victim of corruption scandal

Brazilian chief of staff Jose Dirceu resigned Thursday to return to Congress and “defend” himself against the expanding bribes scandal that is currently besetting President Lula da Silva's administration and the ruling Workers Party (PT).

"I've told the president I want to leave my job. The president accepted my request and I will resume my seat as federal Deputy for Sao Paulo", said the all powerful aide who's the first Cabinet official to resign because of the growing scandal.

Mr. Dirceu, several other cabinet members and leading Workers party officials have been accused by a dissenting Congress member of operating a bribes ring to ensure legislative support for the government.

"From Congress I will make clear to the country, to public opinion the current debate. I've nothing to be ashamed of, my hands are clean", emphasized Mr. Dirceu who said the will work with the party to combat "those who want to interrupt Brazil's political and democratic process and want to destabilize President Lula's administration".

Lower House member Roberto Jefferson and head of the small Labour Party which belonged to the ruling coalition, claimed that Mr. Dirceu was well aware of the millions paid out to legislators under the vote-buying scheme, and hid the matter from President Lula. Jefferson added that the bribes scheme ended last January when the "fence" erected by Dirceu to keep President Lula in the dark collapsed.

Already under investigation for his alleged links to graft in several government run companies, Mr. Jefferson was summoned before a congressional ethics committee for having made the claims without the supportive evidence. However he insisted that the paymaster was the Workers Party treasurer Delubio Soares and that at least five top administration officials were aware of the bribes ring including Finance Minister Antonio Palocci.

Describing Mr. Lula da Silva as a "simple, straight and noble man", Jefferson attacked Dirceu as the "Rasputin ...of the plot, capable of making Lula a prisoner", adding that he had revealed the bribes ring directly to President Lula da Silva last January when the president immediately ordered an end to all illegal activities. Mr. Jefferson said that when the payments "dried up", several legislators experienced "withdrawal symptoms", which supposedly left the administration with little or no leverage in Congress.

Further on Jefferson accused Dirceu and the government intelligence agency, together with Brazil's largest circulation magazine Veja, of the set up linking him to a corruption ring in the Post Office which was managed by officials belonging to his Labour Party.

The Brazilian Lower House Ethics Committee now has twenty days to investigate Deputy Jefferson's claims and will then have to decide whether he remains or is fired from Congress.

However several other cabinet members have been summoned to the Committee, Integration Minister Ciro Gomes; Political Coordination Minister Aldo Rebelo; Waldrido Mares, Tourism Minister; Science and Technology Minister Eduardo Campos and Labour Minister Ricardo Berzoini.

This is the most serious political crisis faced by President Lula da Silva since taking office in January 2003 promising to battle corruption and work for social justice. So far the country's financial markets seem to be weathering the impact of the political storm.

Mr. Dirceu a former guerrilla exiled in Cuba was the master mind behind the Workers Party victory in the first round in October 2002 and Mr. Lula's most trusted, and until now, efficient political advisor.