This is very interesting, referring to Canadian system:
Cost of the NSERC Science Grant Peer Review System Exceeds the Cost of Giving Every Qualified Researcher a Baseline Grant:
Using Natural Science and Engineering Research Council Canada (NSERC) statistics, we show that the $40,000 (Canadian) cost of preparation for a grant application and rejection by peer review in 2007 exceeded that of giving every qualified investigator a direct baseline discovery grant of $30,000 (average grant). This means the Canadian Federal Government could institute direct grants for 100% of qualified applicants for the same money. We anticipate that the net result would be more and better research since more research would be conducted at the critical idea or discovery stage. Control of quality is assured through university hiring, promotion and tenure proceedings, journal reviews of submitted work, and the patent process, whose collective scrutiny far exceeds that of grant peer review. The greater efficiency in use of grant funds and increased innovation with baseline funding would provide a means of achieving the goals of the recent Canadian Value for Money and Accountability Review. We suggest that developing countries could leapfrog ahead by adopting from the start science grant systems that encourage innovation.
I don’t know how that would work in the USA, and certainly would not work for big $million grants, but this is quite an interesting idea – skipping the peer-review of small grants entirely and just giving all the applicants a Baseline Grant. If they use the money well and are lucky with the result, they will have publications and data they can then use to apply for bigger grants. Some really cool and unusual, non-band-waggony stuff would get done that way. What do you think?