The National Institutes of Health (NIH) recently made a significant announcement regarding a major change in their funding strategy. The agency, which is considered the nation’s premier funder of biomedical research, revealed that it will be slashing support for “indirect costs” that are paid to universities, medical centers, and other research grant recipients. Indirect costs typically cover administrative, facility, and other expenses that are not directly linked to the specific goals of a scientific project.
Historically, the NIH has provided support for indirect costs at an average rate of around 27% of the total cost of a research grant. However, moving forward, this rate of support will be reduced to 15% for both new and existing grants. This decision has significant implications for the nation’s top research universities, many of which rely on indirect cost support rates of more than 50% to cover their operational expenses.
According to a post on X from the NIH, out of the $35 billion spent on research grants during the 2023 fiscal year, $9 billion was allocated towards indirect costs. The agency estimates that this change will result in a government savings of $4 billion annually.
This announcement has sparked concerns within the scientific community, as many institutions heavily rely on indirect cost funding to maintain their research operations. The reduction in indirect cost support could potentially impact the ability of universities and medical centers to conduct cutting-edge research and maintain critical infrastructure.
It is important for stakeholders in the scientific community to closely monitor the implications of this funding change and work towards finding alternative solutions to ensure that essential research activities are not hindered. The NIH’s decision to reduce indirect cost support underscores the ongoing challenges faced by research institutions in securing adequate funding for their operations.
