The past few years have witnessed a rough patch for relations between the US National Institutes of Health (NIH) and its overseers in Congress. Stagnant funding has followed on from the largesse that doubled the biomedical agency's budget between 1998 and 2003. Political leaders have also publicly doubted whether the $28.6-billion agency is making the most of its windfall — and have excoriated agency officials for their allegedly lax approach to financial conflicts among its scientists (see Nature 443, 252–253; 2006).

But two events occurred last week that, between them, have the potential to mark a turning point for the world's largest research agency. On Friday, the only NIH researcher to face criminal charges over conflict-of-interest issues arising from a forthright investigation by the Los Angeles Times, subsequently followed up in Congress, pleaded guilty in a federal court (see page 803). His sentencing on 22 December, along with new, tighter agency rules, may begin to disperse the cloud that has been hanging over the agency as a result of the actions of a few dozen NIH researchers.

Perhaps more importantly, in the small hours of 9 December, the outgoing Congress — pushed along by Congressman Joe Barton (Republican, Texas) — passed a bill that will guide the management of the agency over the coming years (see page 796).

This 'authorization' bill sets caps that could permit further increases in the NIH budget. This is no guarantee that the money will actually be doled out by the appropriations committees in Congress. But it is, says NIH director Elias Zerhouni, “a renewed vote of confidence in the NIH and really a turning point”. Zerhouni asserts that after years of wondering aloud about whether the NIH would deliver on its doubled budget, Congress has finally decided that the agency is doing a good job — and that it needs help to do a better one.

There are other reasons why the National Institutes of Health Reform Act of 2006 is important. Once President Bush signs the bill, the NIH will have, for the first time in 13 years, a broad, explicit and up-to-date law governing its administrative structure. The bill lays out some significant requirements that may in effect buy the agency something it has been lacking on Capitol Hill: goodwill. In particular, the bill requires the NIH director to submit biennial reports to Congress, detailing the work of its 27 institutes and centres, and justifying their priorities. It is this kind of accountability that many in Congress felt has been missing since the doubling of the budget; delivering on it will help the agency re-establish its reputation there.

At the same time, the bill establishes a 'common fund' comprising up to 5% of the agency's total budget. This will be used to fund multi-institute research that otherwise wouldn't happen, helping the NIH keep up as biomedical science evolves at unprecedented speed.

For many biomedical researchers, funding levels represent the clearest indication of whether goodwill has been re-established. In this regard, the omens are good, particularly given the allocation of critical committee positions in the new Congress. David Obey (Democrat, Wisconsin), a long-time champion of the NIH, will be chairing the relevant subcommittee in the House of Representatives, as well as the full appropriations committee. On the Senate side, Tom Harkin (Democrat, Iowa), another long-standing NIH devotee, is set to chair the subcommittee funding the agency.

Given this sort of backing, and last week's events, it is beginning to look as if the NIH could enjoy a happier and more prosperous new year than might have been envisaged just a few months ago.