Facing graft charges, Brazil's Lula joins government in crisis

Brasilia: Brazilian President Dilma Rousseff named her predecessor Luiz Inacio Lula da Silva as her chief of staff on Wednesady, sparing him possible arrest for corruption as she seeks to fend off a damaging crisis.

The two leftists who have led Brazil for the past 13 years are both fighting for their political survival, and news they were teaming up again in the government deeply divided Brazil even before it was officially announced.

 Allies call Lula the only man capable of saving the embattled government, but opponents condemn the fact that ministerial immunity will now protect him from prosecution in ordinary court.

Cabinet ministers can only be tried before the Supreme Court in Brazil.

The appointment is a risky bet for Rousseff, who is battling crises on multiple fronts: an impeachment attempt, a deep recession, mass protests and the fallout of an explosive corruption scandal at state oil giant Petrobras.

Lula was hugely popular when he stepped down five years ago at the height of an economic boom, but he returns to Brasilia with heavy baggage - he has himself been charged with money laundering in a case linked to the Petrobras scandal.

The opposition was quick to slam the appointment.

"Instead of explaining himself and assuming his responsibilities, former president Lula preferred to flee out the back door," said lawmaker Antonio Imbassahy, lower house leader for opposition party PMDB.

"It's a confession of guilt and a slap to society. President Dilma, by appointing him, has become his accomplice," Imbassahy added. "The final chapter in this story will be her impeachment."

Lula, 70, left office with 80 per cent popularity ratings and the status of a hero to the left.

During his two terms, he presided over a watershed period of prosperity and social programs that helped lift tens of millions of Brazilians from poverty.

But his legacy is now threatened by charges that he accepted a luxury apartment as a bribe from a company implicated in the Petrobras scandal.

At a deeper level, he faces suspicions among many Brazilians that his entire administration was underpinned by graft.

Lula vigorously denies the accusations.

His problems may not stop there, however: prosecutors have indicated they are investigating whether he played a more central role in the multibillion-dollar corruption scheme at the state oil giant.