Who Is Rui Costa? Brazil’s Former Chief of Staff

On April 2, 2026, Rui Costa stepped down as Brazil’s Chief of Staff after three years and three months running the most powerful ministry in the Planalto. He departed from the Estação da Calçada in Salvador — a few metres from the hillside where he was born — and confirmed what Brasília had long assumed: he is running for the Senate in Bahia, and he is leading the polls.

From the Petrochemical Belt to the Palace

Rui Costa’s political career began in the workers’ movement of the 1980s, at the Petrochemical Pole of Camaçari — a sprawling industrial complex outside Salvador that is one of the largest petrochemical hubs in the Americas. He was a union organiser there in an era when Brazil’s labour movement was simultaneously fighting military dictatorship and building the institutional infrastructure of the Workers’ Party. That formation shaped Costa’s political identity: economically pragmatic, institutionally meticulous, and fiercely loyal to Lula, who was himself a union leader before becoming president.

Costa climbed through Salvador’s political apparatus steadily. He served as a city councillor (vereador) in Salvador, then moved to the state level as Secretary of Institutional Relations under Governor Jaques Wagner between 2007 and 2010. In that role he developed a model for coordination between the state executive, the legislature, and social movements — the Institutional Relationship System (SRI) — that was recognised as an innovation in Brazilian sub-federal governance. He was elected federal deputy for Bahia in 2010, receiving the highest number of votes in the PT’s Bahia list.

Governor of Bahia: The Moderate That Made Enemies on Both Sides

Costa ran for the Bahia governorship in 2014 on a PT ticket and won outright in the first round with 54.53%, against 37.39% for his main opponent Paulo Souto. He was re-elected in 2018 with over 75% of the vote — an extraordinary result for any PT candidate in a period when the party was facing its worst national crisis in the wake of the Lava Jato investigations and Lula’s imprisonment.

His eight years as governor were defined by a paradox: he was simultaneously a Workers’ Party loyalist and a governor who made decisions that his own party’s left wing found difficult to stomach. He privatised the state-owned supermarket chain. He approved a pension reform for Bahia’s state employees — an early preview of the national fiscal and tax reform debate that would define the Lula third term. He aggressively pursued public-private partnerships in education and healthcare. In the 2022 presidential election, to defeat Bolsonaro, he allied with PSDB and Democrats — the historic centre-right parties that the PT had spent three decades defining itself against. None of this lost him his PT membership or Lula’s confidence. It earned him, instead, a reputation as someone who could deliver results without losing the political thread.

His governorship also created the CredCesta programme — a benefits card for Bahia state employees that would later become entangled in the Banco Master scandal at the federal level. The connection was not visible at the time. It became significant only when Costa moved to Brasília.

Casa Civil: Three Years as Lula’s Fixer

When Lula won the 2022 election, Costa was one of the first names announced for the new government. His appointment as Chief of Staff — the head of the Casa Civil, the ministry that directly advises the president, coordinates inter-ministerial decisions, and manages the flow of decrees and legislation — was universally interpreted as a signal of Lula’s priorities. The Casa Civil is not a high-profile ministry in terms of public visibility, but it is the room where all decisions are made before they reach the president. Whoever runs it effectively controls the government’s daily operating rhythm.

Costa ran it the way he had run Bahia: centrally. He declared from the start that the government would operate at “correria pace” — sprint pace — and made the Casa Civil the bottleneck for everything that mattered. Ministers from other portfolios learned quickly that their proposals moved faster if they were aligned with Costa’s office. He divided with Finance Minister Fernando Haddad the position of Lula’s principal adviser, and the two were rivals as much as colleagues: both powerful, both with direct access to the president, and representing different wings of the PT coalition. Costa was the political operator; Haddad was the economic architect. Their coexistence defined the Lula third term’s internal dynamics. Haddad was the architect of Brazil’s landmark tax reform — the most significant fiscal restructuring in three decades — while Costa made sure it moved through the Congress on schedule.

His operational style earned him enemies in the Esplanada — the broad avenue in Brasília lined with ministerial buildings where Brazilian government is physically concentrated. Ministers resented the Casa Civil’s reach. Politicians from allied parties complained that Costa’s centralising instincts left insufficient room for the coalition bargaining that keeps a minority government functional. Lula himself acknowledged this at Costa’s farewell ceremony: “Not always does the role of the Casa Civil earn you sympathy.” It was as close to public recognition of Costa’s reputation as a blunt-force administrator as any Brazilian president is likely to deliver.

The Banco Master Shadow

The most significant controversy of Costa’s ministerial tenure concerns his relationship with Banco Master — a mid-sized Brazilian financial institution that became one of the largest scandals of the Lula third term. Two separate connections tie Costa to the bank’s rise.

The first is CredCesta. As governor of Bahia, Costa created a benefits card programme for state employees that Banco Master later used as a template for its expansion into the consignado (payroll-deductible credit) market. The second is more directly damaging: as Chief of Staff, Costa’s Casa Civil issued a decree that restricted the portability of consignado credit — effectively limiting competition in the market and expanding Banco Master’s exclusive operating space. This sits at the centre of what has become the Banco Master scandal, one of the defining crises of the Lula government, with direct implications for Brazil’s fintech and digital banking sector. The decree was later identified by investigators as a material factor in Banco Master’s ability to accumulate deposits and build the structured credit positions at the centre of the scandal.

Costa has denied participating in any scheme. His strategy in response to media coverage was to redirect attention toward Roberto Campos Neto, the former Banco Central president, arguing in a GloboNews interview that Campos Neto bore greater responsibility for the regulatory environment that allowed Banco Master to grow and that the press was disproportionately targeting the PT side of the equation. The Planalto adopted this framing broadly. Whether it holds under continued parliamentary and judicial scrutiny will follow Costa into his Senate campaign.

Why He Left: The Senate Is the Strategy

Costa’s departure from the Casa Civil was not a surprise to anyone watching Brasília closely. By early 2026, it was understood that Lula wanted to use the October elections to strengthen his Senate coalition — the upper house where the PT has historically been weaker than in the Chamber of Deputies. Costa, who commands broad recognition and loyalty in Bahia, was the logical candidate. He confirmed his Senate run on March 21, 2026, and formally left the ministry on April 2.

His successor, Miriam Belchior, had been the Casa Civil’s secretary-executive since the beginning of the Lula government — meaning she had been in the building for the entire duration, knew every file, and required no transition period. Lula’s instruction to her was characteristic of a government entering its final electoral stretch: “Complete what is underway. Do not launch new programmes.”

For Lula’s reelection strategy, a Rui Costa Senate seat for Bahia is a structural gain. Bahia is Brazil’s fifth-largest state by population, a PT stronghold, and a seat from which Costa can operate both as a legislative defender of the Lula agenda and as a power base for whoever the PT eventually nominates for the 2030 electoral cycle. Costa himself does not rule out future presidential ambitions, though he has not confirmed them. In Brazilian political arithmetic, winning a Senate seat in 2026 with a commanding majority — which current polls suggest is possible — would be the correct positioning for any further move.

For the broader picture of Brazil’s 2026 election cycle, Costa’s transition from Planalto to campaign trail marks the moment when the Lula government shifted from governing to campaigning. The Banco Master scandal and the Rui Costa connection will be one of the fault lines opposition candidates attempt to exploit between now and October. The inflation and interest rate environment that constrained the Lula government throughout Costa’s tenure — with the Selic at 14.75%, the highest rate in years — shaped every fiscal trade-off the Casa Civil had to manage and will continue to define the political arithmetic of Brazil’s election year.