BS EDIT: Pay, Performance, & Prudence: Rethinking 8th Pay Commission

By Business StandardPublished On Jul 31, 2025

A Balancing Act Begins

The 8th CPC will impact 11.3 million employees and pensioners. The challenge: Balance welfare with long-term fiscal sustainability

Demands Must Match Reality

Demands to raise the standard consumption norm don’t reflect shrinking households. Current wages already outpace private-sector pay

Labour Distortions Are Growing

High wages and job security attract overqualified applicants to low-skilled jobs, underutilising India’s skilled youth

Hiring Freeze Signals Caution

With 1 in 4 posts vacant, the Centre is turning to contracts. The wage bill is rising, even as permanent hiring stalls

Reward Performance, Not Just Tenure

The CPC must link raises to performance. Inflation is already covered via DA hikes; salary hikes must reflect merit and efficiency

Build a Leaner, Stronger State

Pay structures should attract talent and foster accountability—without undermining fiscal discipline across states and the Centre