《 Q&A on Several Opinions of the General Office of the State Council on Reforming and Improving the Management of Central Financial Research Funds

2021 August 31st of the year;           Source: Department of Science, Education and Culture

    1. What is the background of the issuance of the "Several Opinions"?

    Answer:Since the 18th National Congress of the Communist Party of China, the Party Central Committee with Comrade Xi Jinping as the core has attached great importance to scientific and technological innovation work and insisted on making innovation the primary driving force for development.. The Fifth Plenary Session of the 19th Central Committee of the Communist Party of China emphasized the core position of innovation in the overall modernization construction of our country, and regarded self-reliance and self-improvement in science and technology as the strategic support for national development, placing it at the forefront of various planning tasks and making special arrangements. According to the decisions and arrangements of the Party Central Committee and the State Council, the central finance always prioritizes and guarantees scientific and technological innovation as a key area. From 2013 to 2020, the central government's expenditure on science and technology reached 2.3 trillion yuan; In 2021, despite the continued negative growth of central government expenditure, we adjusted the structure of fiscal expenditure, focused on ensuring science and technology expenditure, and allocated a budget of 322.7 billion yuan to provide strong support for scientific and technological innovation.

    With the rapid growth of fiscal technology funds, it is increasingly important to manage and make good use of research funds, better stimulate the innovation vitality of researchers, and promote the development of science and technology. The Central Committee of the Communist Party of China and the State Council attach great importance to this. General Secretary Xi Jinping has explicitly demanded that scientists be given greater decision-making power over technological routes and funding, freeing research institutions and personnel from cumbersome and unnecessary institutional constraints. Premier Li Keqiang pointed out that it is necessary to implement the policy of expanding the autonomy of fund use and strive to eliminate unreasonable burdens on scientific researchers. Since the 18th National Congress of the Communist Party of China, the Party Central Committee and the State Council have successively issued a series of policy documents and reform measures to optimize the management of scientific research funds, effectively stimulating the innovation vitality of scientific researchers and promoting the development of science and technology. However, there are also issues such as inadequate implementation of certain policy provisions and the need for further deepening of reforms in certain fields in response to new situations and changes.

    To effectively address these issues, the General Office of the State Council has issued the "Several Opinions on Reforming and Improving the Management of Central Financial Research Funds". The "Several Opinions" adhere to a problem oriented and goal oriented approach, proposing 25 reform policies and work requirements from seven aspects, including expanding the autonomy of scientific research project fund management, improving the mechanism of scientific research project fund allocation, and increasing incentives for scientific researchers. Targeted and precise efforts are made to respond to the concerns of the scientific and technological community, improve scientific research fund management, enhance the sense of achievement of scientific researchers, stimulate scientific research innovation and creativity, and produce high-quality scientific and technological achievements, which is of great significance.

    2. How to prepare a direct expense budget based on the simplified budget subjects?

    Answer:The "Several Opinions" propose to further streamline and merge the budget preparation subjects, and streamline the direct cost budget subjects from the current 9 or more to three categories: equipment costs, business costs, and labor costs..

    One is about equipment costs, which mainly include the expenses incurred during the project implementation process for purchasing or trial producing specialized instruments and equipment, upgrading and renovating existing instruments and equipment, and leasing instruments and equipment from external units. Computational instruments, equipment, and software tools can be included in the equipment cost account.

    The second is related to business expenses, which mainly include the procurement, transportation, loading and unloading, and organization costs of various low value consumables such as materials and auxiliary materials consumed during the project implementation process, as well as expenses incurred for testing, laboratory processing, fuel and power, publishing/literature/information dissemination/intellectual property affairs, meetings/travel/international cooperation and exchange, and other related expenses.

    Thirdly, regarding labor fees, they mainly cover the labor related expenses paid to participating graduate students, postdoctoral fellows, visiting scholars, and project hired researchers, research assistants, etc. during the project implementation process; And the fees paid to temporarily hired consulting experts.

    At the same time, the "Several Opinions" require that, except for equipment costs of more than 500000 yuan in direct expenses, only basic calculation explanations need to be provided for other expenses, and no details need to be provided.

    What are the new regulations on the right to adjust the budget of scientific research projects in the "Several Opinions"?

    Answer:In response to the uncertainty of scientific research activities, the "Several Opinions" have achieved the full delegation of budget adjustment rights for scientific research projects. Firstly, the equipment cost budget adjustment rights have been fully delegated to the project undertaking unit, meaning that the project leader does not need to apply for an increase in equipment cost budget from the project management department.; The second is the right to adjust other expenses except for equipment costs, which is fully delegated by the project undertaking unit to the project leader, who can independently arrange according to the needs of scientific research activities.

    What new arrangements does the "Several Opinions" have for expanding the funding contracting system?

    Answer: Since 2019, we have worked with relevant departments to carry out pilot projects for the use of funds under the lump sum system in the National Science Fund for Distinguished Young Scholars and the Postdoctoral Science Fund. From the implementation situation, the pilot of the lump sum system has achieved good results, and scientific research units and project leaders have given high praise. The "Several Opinions" further expanded the implementation scope of the funding contracting system from the perspectives of scientific research projects and research institutions. At the project level, based on summarizing the pilot experience, it is clear to implement a funding system for talent and basic research research projects. Secondly, at the institutional level, relevant departments and localities are encouraged to pilot the funding system for independent legal research institutions engaged in fundamental, cutting-edge, and public welfare research.

    How to improve the funding allocation mechanism for scientific research projects?

    Answer: The allocation of research project funds involves multiple links such as the finance department, project management department, project leading and undertaking unit, and project participating unit. Several opinions have put forward requirements for the management of each link. Firstly, from the finance department to the project management department, research funds can be pre allocated before departmental budget approval. Secondly, from the project management department to the project undertaking unit, it is explicitly required that the project management department formulate a reasonable fund disbursement plan and disburse the funds to the project undertaking unit within 30 days after the project task book is signed. Thirdly, from the project leading unit to the project participating units, the project leading unit should timely allocate funds to the project participating units based on the opinions of the project leader.

    What new measures have been proposed in the "Several Opinions" regarding the management of surplus funds?

    Answer:In order to encourage research institutions and researchers to save funds and avoid sudden spending, the "Several Opinions" further improve the management of surplus funds. One is to relax the retention policy and not withdraw after two years. After clarifying the task objectives of the project and passing the comprehensive performance evaluation, the surplus funds will be retained by the project undertaking unit for use and will not be recovered. The unit will coordinate and arrange direct expenditures for scientific research activities, giving priority to the research needs of the original project team. The second is to improve the efficiency of fund utilization. Require the project undertaking unit to strengthen the management of surplus funds, improve the mechanism for activating surplus funds, prevent excessive scale of surplus funds, and accelerate the progress of fund utilization.

    How to manage indirect costs of scientific research projects in the future?

    Answer: In order to increase incentives for scientific researchers, the "Several Opinions" have further improved the management of indirect costs in scientific research projects and proposed measures with higher value and greater incentive. One is the proportion of indirect expenses approved. According to a certain proportion after deducting equipment purchase costs from direct expenses, the proportion of indirect expenses for the portion below 5 million yuan shall be increased from no more than 20% to 30%; The portion of 5 million to 10 million yuan shall be increased from no more than 15% to 25%; The portion exceeding 10 million yuan shall be increased from no more than 13% to 20%. The proportion of indirect costs for pure theoretical research projects such as mathematics has been further increased to no more than 60%. The second is the subject of indirect cost management. Indirect costs shall be arranged and utilized by the project bearing unit in a coordinated manner. The third requirement is indirect cost management. The project undertaking unit can use all indirect costs for performance expenditures and tilt towards teams and individuals with outstanding innovation performance, motivating researchers to produce more high-quality innovation results.

    8. What pilot areas have been expanded to provide stable support for the extraction of research funding and reward funds?

    Answer: In order to support units in exploring and improving incentive and guidance mechanisms for scientific research project funds, in 2018, the Ministry of Science and Technology, the Ministry of Finance, and other departments launched a pilot reform of scientific research management based on performance, integrity, and ability, allowing pilot units to extract reward funds from stable support for scientific research funds. On the basis of summarizing the pilot experience, the "Several Opinions" propose to expand the pilot scope of stable support for scientific research funding extraction and reward funds from two aspects. Firstly, to further expand the scope of pilot units, from some research institutes under the Chinese Academy of Sciences to all central level research institutes. The second is to further expand the scope of stable research funding that can be extracted as reward funds. On the basis of the basic research business expenses and the strategic leading technology special funds of the Chinese Academy of Sciences, increase the special funds for innovation projects of relevant research institutes.

    How to manage labor fees?

    Answer:The "Several Opinions" further optimize the management of labor fees. When issuing labor fees, project undertaking units should pay attention to the following three aspects.. One is that in terms of the recipients, the recipients of labor fees are project hired personnel, that is, personnel hired by the project undertaking unit through labor dispatch, signing labor contracts, employment agreements, etc., including graduate students, postdoctoral fellows, visiting scholars who participate in project research, as well as project hired researchers, research assistants, research (finance) assistants, etc. Secondly, in terms of payment standards, the labor cost expenditure standards are determined based on the average salary level of local scientific research and technical service industry employees, and according to the work tasks undertaken by project employees in project research. Thirdly, in terms of expenditure scope, the labor cost required for the project's hired personnel can be covered through the labor fee account, including social insurance subsidies for project hired personnel, housing provident fund, etc. That is to say, the "five insurances and one fund" of the personnel hired for the project can be included in the labor cost.

    How is the policy on the total amount of performance-based pay for central universities, research institutes, and enterprises stipulated in the "Several Opinions"?

    Answer:In order to further mobilize the enthusiasm, initiative, and creativity of scientific research personnel, and better play the supporting role of performance-based salary distribution in scientific and technological innovation, the "Several Opinions" have improved the dynamic adjustment mechanism of performance-based salary. Central universities, research institutes, and enterprises will apply for dynamic adjustment of performance-based salary levels to the competent department based on their own development stage, type positioning, tasks undertaken, talent structure, location, actual level of performance-based salary payment (mainly determined based on the annual salary statistics of public institutions in the previous year), financial situation, especially the indirect expenses that can be used to pay for personnel performance in financial research projects. The competent department will comprehensively consider stimulating scientific and technological innovation vitality, ensuring stable salary income for basic research personnel, and regulating different units (positions, disciplines) After the approval of factors such as income inequality, it shall be reported to the human resources and social security and finance departments for filing.

    What requirements does the "Several Opinions" put forward to increase the incentive for researchers to transform scientific and technological achievements?

    Answer: In order to fully mobilize the enthusiasm and initiative of researchers in the transformation of scientific and technological achievements, and promote the acceleration of the transformation of scientific and technological achievements into practical productivity, the "Several Opinions" propose that all units should implement relevant regulations such as the "Law on Promoting the Transformation of Scientific and Technological Achievements" and accelerate the pace of scientific and technological achievement transformation. At the same time, it is emphasized that cash rewards for the transformation of scientific and technological achievements should be included in the total performance-based salary of the unit, but not limited by the approved total performance-based salary, and should not be used as the basis for determining the total performance-based salary for the next year. This will increase incentives for scientific researchers.

    How to promote the solution to the cumbersome problem of scientific research funding reimbursement?

    Answer:The "Several Opinions" adhere to a problem oriented approach, focus on the difficulties and bottlenecks in expense reimbursement, and make targeted and precise efforts to reduce the burden of reimbursement for scientific researchers..

    One is to fully equip research finance assistants, allowing professionals to do professional things. The "Several Opinions" clearly state that the project undertaking unit should fully implement the scientific research financial assistant system, ensure that each project is equipped with a relatively fixed scientific research financial assistant, provide professional services for scientific researchers in budget preparation, expense reimbursement, and other aspects, and no longer let scientific researchers spend energy on scientific research expense reimbursement.

    The second is to improve the financial reimbursement management method and effectively solve problems such as "finding tickets" and "pasting tickets" for scientific researchers. The "Several Opinions" require project undertaking units to continuously improve their financial reimbursement management methods. When hosting conferences, they can reimburse the inter city transportation expenses and international travel expenses of invited domestic and foreign experts, scholars, and relevant personnel who need to bear the conference fees and other expenses; A lump sum system can be implemented for meal allowances, urban transportation expenses, and accommodation expenses that are difficult to obtain invoices for domestic travel expenses.

    The third is to promote paperless reimbursement, allowing digital information to run more and researchers to run less errands. The "Several Opinions" propose to strengthen the informatization construction of scientific research fund reimbursement, clarify the promotion of paperless reimbursement pilot for scientific research funds, select some central universities, research institutes, and enterprises to be included in the promotion scope of electronic accounting voucher accounting data standards, promote the digitization and paperless reimbursement of scientific research funds, and effectively reduce the reimbursement burden of scientific research personnel.

    The fourth is to implement early warning reminders and improve service levels. The "Several Opinions" propose to strengthen the legal person responsibility of the project undertaking unit, requiring the project undertaking unit to dynamically supervise the use of funds and provide real-time warning reminders, integrating service into management. By reminding and urging scientific researchers to make good use of scientific research funds in accordance with regulations, it lays the foundation for smooth reimbursement and improves the level of financial reimbursement services provided by the unit.

    13. What measures does the "Several Opinions" take to simplify the financial management of scientific research project acceptance and completion?

    Answer: The final acceptance of scientific research projects is an international practice, and researchers need to provide the materials required for acceptance. In order to free scientific researchers from complex administrative work, the "Several Opinions" adhere to a problem oriented approach and adopt three measures for the final acceptance of research funding, effectively reducing the burden on scientific research units and personnel. One is to emphasize the integration of financial and technical acceptance, and implement a one-time comprehensive performance evaluation at the end of project implementation. The second is to improve the operational guidelines for project acceptance and evaluation, refine and clarify specific requirements for financial, accounting, and auditing aspects such as budget adjustment, equipment management, and personnel costs, in order to avoid deviations in understanding and implementing policies by relevant institutions and personnel during project acceptance and inspection. The third is to select some central universities, research institutes, and enterprises as pilot units, and have them issue research project funding final accounts as the basis for project closure, and cancel the financial audit of research project closure.

    14. How to optimize the procurement management of scientific research instruments and equipment?

    Answer: The "Several Opinions" have optimized the procurement management of scientific research instruments and equipment from both policy and implementation aspects. One is to implement special management policies for the procurement of scientific research instruments and equipment by central universities, research institutes, and enterprises from a policy perspective, emphasizing that central universities, research institutes, and enterprises adopt a special procurement mechanism for equipment and consumables urgently needed for scientific research, and can handle them on demand without going through bidding procedures. Secondly, in terms of implementation, it is required that central universities, research institutes, and enterprises optimize and improve internal management regulations, simplify the procurement process of scientific research instruments and equipment; Clarify the Ministry of Finance's responsibility for the project