Limiting the functional integral in quantum gravity to gauge transformations

Within the background field method of quantum gravity, I show that if the quantum fluctuations are limited to gauge transformations rather than the physical degrees of freedom, all the quanum corrections vanish on shell and effective action is equal to the classical action. The resulting theory is finite and unitary and requires no renormalization. I also show that this parametrization renders the effective action independent of the on-shell condition for the background fields, a unique form of background independence. While this approach represents a significant departure from conventional quantum field theory, it can potentially explain several unresolved problems in quantum gravity, including the question of background independence and the cosmological constant problem. In this talk, I will discuss these issues and summarize my current efforts to incorporate matter fields.