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China's system of paying researchers before they begin a project should be replaced by a system that pays based on the results of research rather than its potential, according to a leading policy advisor who believes this will encourage innovation.

A policy advisor at the Chinese Academy of Sciences, however, has told SciDev.Net the proposal does not take into account the uncertain nature of scientific research.

Under the Chinese government's current research funding system, money is prepaid to researchers whose applications are successful.

"But this does not ensure the researchers produce innovative results," Xu Huandong, a professor at the Beijing-based Central University of Finance and Economics, told SciDev.Net. He added that "even if researchers fail to produce the desired results", they need not pay back the funding they have received.

Xu recommends switching to a system where the government pays only for innovations produced by the research.

The current system is wasting significant amounts of public money as China increases its research and development budget, says Xu, who advises the government on funding.

Xu says researchers struggle for funding under the current system, but once they have their grants, many lose interest in producing innovative results.

The results-based system would also discourage favouritism, says Xu, as funding evaluators would have to back up their decisions with proof of how well a project delivered rather than basing them on subjective assessments of a project's potential.

Xu proposes that the government publicise the list of researchers it plans to fund at the start of each year, and then buy any innovative results appearing in the list at the end of each year.

Under the proposal, the government could offer loans to research institutes to support the studies. It would also continue to fund some areas of basic research, including mathematics, theoretical physics and military research.

"By adopting this system, we can avoid wasting public funding and make sure the government research and development budget is spent effectively," Xu says.

In an interview with SciDev.Net, Duan Yibing, a policy researcher at the Chinese Academy of Sciences, said the proposed system does not take into account the very nature of scientific research, in which there are always uncertainties.

"The prepayment system has been adopted worldwide and China is no exception," said Duan. "We can reasonably re-allocate the proportion of research funding to different sectors and institutes to increase efficiency."

But Xu says that in developed countries, the stricter evaluation system avoids wasting research funding.

He adds that "as a developing country, China must make sure its limited funding resources produce as many truly innovative results as possible. If it wants to do so, the prepayment funding system should be abandoned."

Last year, China's research and development budget rose by nearly 20 per cent to 184.3 billion yuan (US$22.75 billion), accounting for 1.35 per cent of the gross domestic product, according to the country's National Bureau of Statistics.

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