https://www.science.org/content/article/nih-slashes-overhead-payments-research-sparking-outrage
NIH slashes overhead payments for research, sparking outrage
Move to cut indirect cost rate to 15% could cost universities billions of dollars
In a Friday night move that quickly drew howls of protest from the U.S. biomedical research community, President Donald Trump’s administration today announced it is immediately reducing by roughly half the so-called indirect cost payments that the National Institutes of Health (NIH) makes to universities, hospitals, and research institutes to help cover facilities and administrative costs.
A 15% indirect cost rate will now apply to all new and existing grants, NIH said in a memo from its Director’s office. Typically, about 30% of an average NIH grant to an institution is earmarked for indirect costs, although some universities get higher rates. In 2023, NIH, the world’s largest funder of biomedical research, spent nearly $9 billion on indirect costs; the change would likely leave research institutions needing to find billions of dollars from other sources to support laboratories, students, and staff.
“It is… vital to ensure that as many funds as possible go towards direct scientific research costs rather than administrative overhead,” NIH wrote in the memo. The new rate brings NIH into line with the maximum indirect costs rates allowed by private foundations, NIH noted, and is higher than the minimum 10% indirect cost payment NIH is required to provide. “This rate will allow grant recipients a reasonable and realistic recovery of indirect costs,” the memo stated.
NIH slashes overhead payments for research, sparking outrage
Move to cut indirect cost rate to 15% could cost universities billions of dollars
In a Friday night move that quickly drew howls of protest from the U.S. biomedical research community, President Donald Trump’s administration today announced it is immediately reducing by roughly half the so-called indirect cost payments that the National Institutes of Health (NIH) makes to universities, hospitals, and research institutes to help cover facilities and administrative costs.
A 15% indirect cost rate will now apply to all new and existing grants, NIH said in a memo from its Director’s office. Typically, about 30% of an average NIH grant to an institution is earmarked for indirect costs, although some universities get higher rates. In 2023, NIH, the world’s largest funder of biomedical research, spent nearly $9 billion on indirect costs; the change would likely leave research institutions needing to find billions of dollars from other sources to support laboratories, students, and staff.
“It is… vital to ensure that as many funds as possible go towards direct scientific research costs rather than administrative overhead,” NIH wrote in the memo. The new rate brings NIH into line with the maximum indirect costs rates allowed by private foundations, NIH noted, and is higher than the minimum 10% indirect cost payment NIH is required to provide. “This rate will allow grant recipients a reasonable and realistic recovery of indirect costs,” the memo stated.
Comments