Objective To prospectively test two simplified peer review processes, estimate the agreement between the simplified and official processes, and compare the costs of peer review.

Design, participants and setting A prospective parallel study of Project Grant proposals submitted in 2013 to the National Health and Medical Research Council (NHMRC) of Australia. The official funding outcomes were compared with two simplified processes using proposals in Public Health and Basic Science. The two simplified processes were: panels of 7 reviewers who met face-to-face and reviewed only the nine-page research proposal and track record (simplified panel); and 2 reviewers who independently reviewed only the nine-page research proposal (journal panel). The official process used panels of 12 reviewers who met face-to-face and reviewed longer proposals of around 100 pages. We compared the funding outcomes of 72 proposals that were peer reviewed by the simplified and official processes.

Main outcome measures Agreement in funding outcomes; costs of peer review based on reviewers’ time and travel costs.

Results The agreement between the simplified and official panels (72%, 95% CI 61% to 82%), and the journal and official panels (74%, 62% to 83%), was just below the acceptable threshold of 75%. Using the simplified processes would save $A2.1–$A4.9 million per year in peer review costs.

Conclusions Using shorter applications and simpler peer review processes gave reasonable agreement with the more complex official process. Simplified processes save time and money that could be reallocated to actual research. Funding agencies should consider streamlining their application processes.