* Congress asked to draft agenda for non-binding national vote
* Campaign finance, election reform likely on ballot
* Opposition decries plan as a diversionary tactic
President Dilma Rousseff sent Congress reform proposals on Tuesday intended to make Brazilian politics more representative in a bid to recoup popularity she lost in a wave of angry protests against the country's political establishment.
Making good on a promise in the wake of the protests that rocked Brazil in June, Rousseff asked Congress to hold a non-binding national vote, or plebiscite, to see what Brazilians want changed. In the request, she listed broad themes that she wants to see addressed, including campaign finance reform, an end to anonymous votes by lawmakers in Congress, and a possible shift from proportional representation to district voting.
Rousseff's approval ratings have declined by 27 percentage points in the past three weeks, showing that the recent wave of protests sweeping Brazil poses a serious threat to her likely re-election bid next year, according to a survey by pollster Datafolha published on Saturday.
More than 1 million people took to the streets of Brazilian cities at the peak of last month's protests, fueled by frustration with deplorable health, education and public transportation services, a high cost of living, and outrage at the $14 billion Brazil will spend to host the 2014 World Cup.
The upheaval that paralyzed the country sent politicians a clear message that Brazilians want more effective and transparent government, with an end to corruption.
While the protests were aimed at politicians of all stripes, Rousseff's popularity took a beating and the president has insisted on holding a plebiscite to consult the people.
"It's a fight for more rights, more representation," she said of the protests on Monday.
"The people want to participate, that's why we are proposing a popular vote. The people must be consulted," Rousseff told reporters.
Other issues she suggested the plebiscite address include abolishing unelected stand-ins for senators. Under the Brazilian system, all members of Congress have "substitutes" that can assume their seat if an elected congressman steps down for some reason, such as accepting a Cabinet post. Rousseff also wants the electorate to weigh in on rules that allow lawmakers to be elected with votes from supporters of other parties.
Eighty-one percent of Brazilians supported the street demonstrations demanding changes, according to the Datafolha poll, which also showed that 68 percent of respondents back the idea of holding a plebiscite.
Rousseff's political opponents, however, see the popular vote as a maneuver to distract the country from the real issues of lack of investment in roads, airports, schools and hospitals, and regain support before next year's election.
Senator Alvaro Dias, leader of the main opposition party in the Senate, PSDB, said most of Rousseff's reform proposals - such whether to have public instead of private campaign funding - are dealt with in existing congressional bills. He said a hastily called plebiscite is an unnecessary expense for the nation.
"These are not the priority issues for Brazilians. This is a political distraction," he told reporters.
'THIS COULD BE A FIASCO'
The plebiscite also poses a risk to Rousseff. The main ally in her Workers' Party coalition government, the PMDB party, is balking at the idea and would rather see reform drawn up in Congress, which it controls.
"This could be a fiasco," said Andre Cesar, a political analyst at Brasilia-based consultancy Prospectiva Consultoria.
"There is a risk that the vote will not happen. Or worse, this could open a Pandora's box and Congress could decide to debate ending the re-election of presidents," Cesar said.
Rousseff still has an approval rating just above 50 percent and remains the favorite to win the election in October 2014, though the race now looks more competitive.
Some political analysts believe the plebiscite is not the way to recover lost ground. In their view, Rousseff should keep focus on curbing inflation and resurrecting Brazil's economy, which has been largely stagnant for the last two years.
Smaller protests continue around Brazil, but a catalyst for the massive demonstrations has gone. The Confederations Cup, a warm-up for next year's soccer World Cup, ended on Sunday.
Other challenges exist. Some of Brazil's main labor unions, seeking to take advantage of the tense political climate, are planning a day of marches on July 11 to push their demands, such as a shorter work week.