Index of rationalisation

The index of rationalisation is the 7th CPC factor (2.57 to 2.81) that builds each pay-matrix level's entry pay. Level-by-level values, worked out and sourced.

Updated 2 August 2026

The index of rationalisation is the set of multiplication factors that the 7th Central Pay Commission applied to the 6th CPC entry pay of each grade to fix the first cell of that grade’s level in the pay matrix. The factors rise from 2.57 at the lowest levels to 2.81 at the apex, so that the gap between successive pay bands widens with role, responsibility and accountability rather than staying flat.

It is the least understood number in the 7th CPC pay structure, because it looks like the fitment factor and is often confused with it. The two are different tools doing different jobs. The fitment factor of 2.57 converts a serving employee’s own pay into a revised figure. The index of rationalisation is a structural constant that was used once, when the matrix was drawn, to set where each level starts. This article explains what the index is, why the Commission introduced it, its exact value at every level, and the 2017 amendment that corrected it. For the full level and cell table, see the pay matrix; for the individual conversion method, see pay fixation and the CCS (Revised Pay) Rules, 2016.

What the index of rationalisation is

Each level of the pay matrix has a first cell, the entry pay of that level. The 7th CPC did not pick those entry figures at random. It took the 6th CPC entry pay of the grade, that is the minimum of the pay band plus the grade pay for a direct recruit, and multiplied it by a factor assigned to that level, then rounded to the nearest hundred rupees. That factor is the index of rationalisation. The Commission set it out in Chapter 5.1 of its report, at paragraph 5.1.19 and the paragraphs that follow.

The index is a small ladder of six values, 2.57, 2.62, 2.67, 2.72, 2.78 and 2.81, that climb as the levels climb. Because a higher level is built from its old entry pay multiplied by a larger factor, the same rupee of old pay reaches a higher new floor at a senior level than it would at a junior one. That is the whole point: the structure expresses a widening premium for seniority.

Three distinctions matter, and getting them wrong is the usual source of error:

The index of rationalisation is not the fitment factor. The 2.57 fitment factor of Rule 7 of the CCS (Revised Pay) Rules, 2016 converts an individual serving employee’s existing basic pay into a revised figure, then rounds it to the nearest cell. It applies to a person. The index applies to a level, once, to build its entry pay. The two coincide at 2.57 for Levels 1 to 5, which is exactly why they are confused; above Level 5 they diverge.
The index of rationalisation is not the annual increment. The annual increment is the 3% vertical step down a single level’s column. The index fixes the horizontal starting point of each column, not movement within it.
The index of rationalisation is never applied to an individual. No employee is ever multiplied by 2.62 or 2.72. Every employee is fixed by the 2.57 fitment method; the higher index is already built into the level’s entry pay and is never applied a second time to the person.

Why the 7th CPC introduced it

Under the 6th Central Pay Commission, pay ran on four running pay bands, PB-1 to PB-4, with a grade pay attached to each post. A band was a wide continuous range shared by several grades, so the differential between adjacent grades compressed, and pay drawn in one grade could overlap the pay drawn in the grade above it. A senior employee near the top of a band could out-earn a junior colleague just promoted into the next grade. The running-band design blurred the very hierarchy the pay structure was meant to express.

The 7th CPC replaced the bands with the 18-level matrix and used the index of rationalisation to rebuild a defined vertical progression: a fixed, non-overlapping entry pay for each level, with the gap between levels deliberately widened at the higher pay bands. Its stated justification is that the role, responsibility and accountability of a post increases at each step in the hierarchy, the same principle earlier commissions used to give senior officers higher scales.

The design was contested, and an honest account should say so. The Staff Side of the Joint Consultative Machinery argued before the National Anomaly Committee that a varying multiplication factor disturbs vertical relativity, since no new responsibilities were added to any grade between 2006 and 2016, and that continuing it widens the ratio of minimum to maximum pay. The Staff Side proposed applying the top factor of 2.81 uniformly to every level, which would have lifted the minimum pay to about Rs. 19,670. The government did not accept that proposal, and the graded index remains in force.

The index of rationalisation, level by level

The table below gives the index applied at each level, the 6th CPC entry pay it was applied to, and the resulting first cell of the level in the matrix. Every entry cell is the 6th CPC entry pay multiplied by the index, rounded to the nearest hundred rupees, which matches the printed Schedule at each level.

Level	Former grade pay or scale	6th CPC entry pay (Rs.)	Index	Matrix first cell (Rs.)
1	GP 1800	7,000	2.57	18,000
2	GP 1900	7,730	2.57	19,900
3	GP 2000	8,460	2.57	21,700
4	GP 2400	9,910	2.57	25,500
5	GP 2800	11,360	2.57	29,200
6	GP 4200	13,500	2.62	35,400
7	GP 4600	17,140	2.62	44,900
8	GP 4800	18,150	2.62	47,600
9	GP 5400 (PB-2)	20,280	2.62	53,100
10	GP 5400 (PB-3)	21,000	2.67	56,100
11	GP 6600	25,350	2.67	67,700
12	GP 7600	29,500	2.67	78,800
13	GP 8700	46,100	2.67	1,23,100
13A	GP 8900	49,100	2.67	1,31,100
14	GP 10000	53,000	2.72	1,44,200
15	HAG	67,000	2.72	1,82,200
16	HAG+	75,500	2.72	2,05,400
17	Apex (fixed)	80,000	2.81	2,25,000
18	Cabinet Secretary (fixed)	90,000	2.78	2,50,000

One caveat belongs with the table. The Level 9 (grade pay 5400 in PB-2) direct-recruit entry pay of Rs. 20,280 is a figure the Commission interpolated from the fitment table issued after the 6th CPC, because the 6th CPC prescribed no direct-recruit entry pay for that grade. Every other row derives exactly: the report prints the Level 13A derivation as Rs. 49,100 multiplied by 2.67, and paragraph 5.1.20 states in terms that the entry pay of grade pay 10000 along with that of HAG and HAG+ was enhanced by a multiple of 2.72, which is what Table 4 and the index row of Table 5 both print for Levels 14, 15 and 16. Only Level 17, the apex, uses 2.81.

A worked example

Level 6 shows how the index builds an entry pay, and how much it adds over a flat factor. The former grade pay is Rs. 4,200 in PB-2, so the 6th CPC entry pay of a direct recruit is the minimum of PB-2 (Rs. 9,300) plus the grade pay (Rs. 4,200), which is Rs. 13,500. Applying the Level 6 index of 2.62 gives Rs. 13,500 multiplied by 2.62, which is Rs. 35,370, rounded to Rs. 35,400. That is the first cell of Level 6.

Had the flat 2.57 fitment factor been used instead, Rs. 13,500 multiplied by 2.57 would give Rs. 34,695, rounding to Rs. 34,700. The extra 0.05 of index adds about Rs. 700 to the Level 6 entry pay, and because the index climbs further up the matrix, the gap compounds. This is the concrete effect of the index of rationalisation: the same Rs. 13,500 of old pay reaches a higher new floor because Level 6 sits in a higher pay band than Level 5.

The 2017 amendment

The matrix as first notified with the CCS (Revised Pay) Rules, 2016 (G.S.R. 721(E), 25 July 2016) built Level 13, the director grade with grade pay 8700, using an index of 2.57. Its 6th CPC entry pay of Rs. 46,100 multiplied by 2.57 is Rs. 1,18,477, rounded to Rs. 1,18,500. That was lower than the 2.67 applied to Levels 10 to 12 just below it, so the Level 13 entry pay compressed against the levels beneath, an anomaly that officer associations and the Staff Side pressed hard.

The Central Civil Services (Revised Pay) (Amendment) Rules, 2017, notified as G.S.R. 592(E) by the Department of Expenditure on 15 June 2017 and effective from 1 January 2016, substituted a revised matrix in Part A of the Schedule. It raised the Level 13 index from 2.57 to 2.67, so Rs. 46,100 multiplied by 2.67 is Rs. 1,23,087, rounded to Rs. 1,23,100, and it shortened the column from 21 stages to 20. Any table still showing Rs. 1,18,500 for Level 13 predates this amendment and is out of date. The amendment did not create Level 13A: that column is printed in Table 5 of the 7th CPC report of 19 November 2015 and in Part A of the Schedule as first notified on 25 July 2016. What the government did modify in 2017 was the defence pay matrix, where Resolution No. 1-2/2016-IC dated 16 May 2017 raised the index for Levels 12A and 13, which is the source of the belief that a civil Level 13A was inserted. The correction narrowed the anomaly rather than removing it, since Level 13 still sits at 2.67 while Level 14 above it uses 2.72.

Common confusions

The index of rationalisation and the fitment factor are different tools. The 2.57 fitment factor converts a person’s existing basic pay under Rule 7; the index builds a level’s entry pay in the matrix. They share the number 2.57 only at Levels 1 to 5.
The index is not applied to individuals. Nobody is multiplied by 2.62 or 2.72; the higher index is already inside the level’s entry pay.
The index is not the annual increment. The increment is the 3% vertical step within a level; the index fixes the horizontal starting cell of the level.
The index multiplies each grade’s old entry pay, not the matrix pay of the level below. Two consecutive cells within a level stand in a ratio of 1.03, the annual increment; successive entry cells across the levels rise by about 1.16 on average, and neither figure is the index.
The Level 13 entry pay is Rs. 1,23,100, corrected by the 2017 amendment, not the Rs. 1,18,500 in the original 2016 schedule.

The index of rationalisation and the 8th CPC

The index of rationalisation is a feature of the 7th CPC structure, not a permanent fixture of central pay. The 8th Central Pay Commission, constituted on 3 November 2025, will design its own pay structure. It may keep a rationalisation index, revise the values, or replace the approach, and it will set its own fitment factor for converting existing pay. No 8th CPC index, fitment factor or matrix has been notified, so any figure circulating for it is a projection. Until the Commission reports and new rules are notified, the 7th CPC matrix built on the index above remains the operative pay structure.

Frequently Asked Questions (FAQs)

What is the index of rationalisation?

It is the set of multiplication factors, from 2.57 to 2.81, that the 7th Central Pay Commission applied to each grade’s 6th CPC entry pay to fix the first cell of that grade’s level in the pay matrix. The factor rises with the pay band so the gap between levels widens with responsibility.

How is the index of rationalisation different from the fitment factor?

The 2.57 fitment factor converts an individual employee’s own existing basic pay under Rule 7. The index of rationalisation is a structural constant used once, when the matrix was drawn, to build each level’s entry pay. They share the number 2.57 only at Levels 1 to 5; above that the index rises.

What are the index of rationalisation values by level?

2.57 for Levels 1 to 5, 2.62 for Levels 6 to 9, 2.67 for Levels 10 to 12 and for Level 13A, 2.67 for Level 13 (raised from 2.57 in 2017), 2.72 for Levels 14 to 16, 2.81 for Level 17 (apex) and 2.78 for Level 18 (Cabinet Secretary).

Why did the 7th CPC use a rising index of rationalisation?

The 6th CPC running pay bands let pay overlap across grades and compressed the differential between them. A rising index rebuilds a defined vertical progression, widening the jump between pay bands at senior levels to reflect greater role, responsibility and accountability.

Did the index of rationalisation change after 2016?

Yes. The CCS (Revised Pay) (Amendment) Rules, 2017 (G.S.R. 592(E), 15 June 2017) raised the Level 13 index from 2.57 to 2.67, moving the Level 13 entry pay from Rs. 1,18,500 to Rs. 1,23,100. Tables still showing Rs. 1,18,500 predate the correction.

External references

References

Report of the Seventh Central Pay Commission (submitted 19 November 2015), Chapter 5.1, “Pay Matrix”, paragraph 5.1.19 and following, on the index of rationalisation.
Central Civil Services (Revised Pay) Rules, 2016, gazette notification G.S.R. 721(E), Department of Expenditure, dated 25 July 2016 (Part A of the Schedule, the pay matrix).
Central Civil Services (Revised Pay) (Amendment) Rules, 2017, gazette notification G.S.R. 592(E), Department of Expenditure, dated 15 June 2017 (revised matrix; Level 13 entry pay Rs. 1,23,100).
Sixth Central Pay Commission entry-pay tables for direct recruits by grade pay, as carried in the CCS (Revised Pay) Rules, 2008 Schedule, used to derive each level’s entry pay.
National Anomaly Committee agenda (Joint Consultative Machinery, Staff Side, 2017) on the pay-matrix anomaly arising from the index of rationalisation.