By Correspondent Stephen Cviic in Sao Paulo

The Brazilian government has achieved an important victory in congress with the completion of voting on a long delayed constitutional reform of the penions system.

The lower house voted by more than the necessary two thirds majority to reject the final opposition amendments to the bill which has been held up for more than three years.

Pensions are a big political issue in Brazil. Over the past few weeks, President Fernando Henrique Cardoso has repeatedly insisted that the $35bn deficit in the social security system is one of the main causes of Brazil's economic troubles.

The left wing opposition disagrees, blaming high interest rates instead.

But ever since it sent the pension reform to congress in 1995, the governing centre right coalition has had problems getting the support of its own deputies, many of whom have been reluctant to sign up to a bill which imposes minimum retirement ages and reduces the privileges of civil servants.

Austerity programme

In fact, this bill comes no where near to tackling the deficit, but in the current turbulent economic climate it is a big victory for the government.

Just last week the Finance Minister, Pedro Malan, announced a much wider austerity programme, designed to restore confidence among investors who have pulled more than $30bn out of Brazil since the middle of August.

Some of Mr Malan's proposals also need the approval of congress and government business managers will be pleased that events appear to be running in their favour.

Meanwhile, further efforts to rescue the world's eighth largest economy are continuing in Washington.