Actually, this model has been suggested by former heads of NIH and NSF, who have publicly expressed concern about the current funding paradigm. The problem is

Actually, this model has been suggested by former heads of NIH and NSF, who have publicly expressed concern about the current funding paradigm. The problem is that impact by reasonable metrics is correlated about 0.30 with grant score, so it's difficult to predict what will be successful. (Note that impact itself is controversial, given self-fulfilling fad dynamics in research -- FOMO popularity spikes and so forth). One of the biggest predictors of grant success is having previously published with people on the review committees. The idea is that you randomly fund research because it's difficult to know what will be important, but try to balance that against grants that might be poorly conceived to begin with.