Weekly Report - 06 August 2009 (WR-09-31)

The government has won control of a R$158bn (US$87bn) welfare fund, the Fundo de Amparo ao Trabalhador (FAT), ahead of next year's general elections. Under a gentlemen's agreement in place since the FAT's creation, the administration of the fund should be rotated every two years between its tripartite council: the government, trade unions and business associations. After two years under the management of a trade-union-nominee, it was the turn for business associations to appoint the fund's next manager. But, following a manoeuvre from the labour minister, Carlos Lupi, a government-ally was chosen to take over the FAT and its spending budget of R$43bn in 2010.