The crazy thing was that if she worked for 10 hours on SBIR stuff, then worked 40 hours on her normal work stuff (so overtime), the SBIR billing would get scaled down to 8 hours (that is, 25% of 40 hours). There would be no way to bill 80 hours.
The other thing that seemed somewhat crazy is that it was also common to have multiple SBIR contracts going on at the same time. If they bought a $10K tool for SBIR grant #1 and SBIR grant #2 needed it two, they'd have to buy a second one. So the tool would be out, then when switching between work on the grants, the tool would go into a locked cabinet, then the second copy of the tool would get unlocked from a different cabinet. I understand that firewalling like that prevents a company from "borrowing" expensive equipment for their own work, but it lead to waste like I just described.
I guess it may not be normal but I got straight time overtime when I worked for a contractor. Made those weeks I really did do 80 hrs nice. But if they have any system involved the fact you did not get paid for the time would be a big red flag.
I've always heard of this nugget of wisdom but never really understood it. By punishing those who underspend (by making the next application harder), wouldn't you incentivise inflated research costs, or worse, fraud. Seems like a quick path to a positive feedback loop towards the degradation of trust in academic spending, leading to "poor government efficiency".
From above(the manager of the program) the job is to budget the funds thriftily and fairly, each project getting the amount it needs.
From below(the team working on the project) this feels like you are punished if you are able to save money and rewarded when you waste money.
I suspect this is probably the major problem with having a more command orientated economy. While it should be fairer(free market economies are notoriously unfair). The inversion in incentive hurts performance.
The rank above you has decided "we need $1 million of software, go buy that." They don't know exactly how much stuff costs, so they use a dollar value as a rough proxy.
If, as manager, you cut corners to save money, you're doing the wrong thing. They want the software! They don't to keep want the money, that's why it was allocated in the budget. Go buy us more Useful Stuff!
but the problem here is how budgets are assigned. instead of a fixed number it should have a lower and an upper bound. at least X, but no more than Y. the closer to you get the better, but next year the budget will be the same range. only if you drop below X you run into the above problem, but then it's much less likely and if you really spend that little something else is wrong or the budget really was to high.
Most solutions to this problem are essentially what the OP recognized as nakedly illegal---that is, exaggerating productive hours---but most contractors are savvy enough to do it in less auditable and more positively regarded ways, such as stretching out timelines (four 20-hour work weeks raise fewer flags than one 80-hour week), adding more chefs than the kitchen calls for, or funding unnecessary little side projects. Straight-up tampering with timecards is an impatient and dangerous way of achieving (IMO) the same wasteful evil as happens everywhere else in the public and private sector.
1 https://www.nrc.nl/nieuws/2024/02/15/het-subsidiepotje-moet-...
It’s also still a reasonable question to ask “well, last year we budgeted $15M and you got acceptable results while spending only $14M; perhaps you only need $14M/yr…” And despite its reasonableness, many people would prefer to oversee a $15M/yr budget.
It’s little surprise what happens under such a system: logical people over-reserve.