Brasilia - A fight over the distribution of government jobs poses an early test for Brazilian President Dilma Rousseff and could endanger her legislative agenda unless she sorts it out quickly.
Leaders from the centrist PMDB party feel they are losing out to Rousseff's Workers' Party, or PT, in the race for prized positions at agencies such as the postal service, which politicians often use to direct spending to their constituencies and perpetuate their grip on power.
Tensions between the two biggest parties in Rousseff's coalition have simmered since well before her inauguration on Saturday and the eruption of a public split so early in her four-year term raises questions about what will happen when Congress starts debating tough issues such as tax reform.
“It's an ugly fight. The PT is taking control of everything. There are several unhappy coalition partners,” PMDB Senator Pedro Simon told Reuters.
Without the support of the PMDB, which holds the largest number of seats in the Senate, Rousseff could struggle to get legislation approved.
Even if she does keep the coalition together, as appears the most likely outcome, she may find it harder to keep legislators in line as she pursues her top priority in Congress - an overhaul of the onerous, complex tax code.
In an apparent move to put pressure on Rousseff, the PMDB made a veiled threat on Tuesday that it could push in Congress for an increase of the minimum monthly wage beyond the modest 5.9 percent hike in the 2011 budget.
That could force Rousseff to adopt higher spending cuts elsewhere. But Finance Minister Guido Mantega said a larger wage hike was reckless and would be vetoed by the government.
The PMDB balked at Rousseff's decision to move control over the postal service and two health sector agencies to the PT. Their combined budgets are around 67 billion reais ($41-billion).
Now, the PMDB is concerned it will also lose control over key state power companies, such as Eletrobras and its various subsidiaries, that together control much of Brazil's power industry.
“The main objective of our party is to wield power and we're getting less of it despite having done better in the elections,” PMDB Senator Almeida Lima told Reuters.
PMDB leaders met on Tuesday to discuss the situation and Rousseff put further appointments on hold.
Rousseff, 63, is holding elected office for the first time after a career spent as a respected government technocrat and she may struggle with the more classic political tasks such as horse-trading among parties and soothing damaged egos.
But the Valor Economico newspaper said in an editorial that Rousseff should be less dependent on the PMDB's support than predecessor Luiz Inacio Lula da Silva because of the other coalition parties' strong performance in the October elections. That should enable her to pass legislation in Congress without the full support of the PMDB, it said.
“In this way, Dilma starts her government in a more favourable situation than her predecessor,” Valor said.
Discontent in the PMDB could cost the Workers' Party its leadership roles in the lower house of Congress when those positions are decided in an internal vote in February.
A similar coalition split cost Lula the chamber's top post a few years ago. Discontent among allies also helped trigger a major scandal in 2005, in which the Workers' Party allegedly resorted to vote-buying in Congress - an episode that nearly led to Lula's impeachment.
During the Lula administration, several PMDB appointees were caught charging kickbacks for public works contracts and analysts say Rousseff is trying to clean up the most corruption-prone state agencies. - Reuters