The Technology Strategy Board (TSB) has been allocated a record £440 million budget this year to support businesses in the UK, including £47 million for the 'Digital Economy'.
The funding boost represents an increase of more than £50 million on last year. Technology areas that will benefit from the investment include renewable energy, future cities, advanced materials, satellites, digital technologies and healthcare.
"The £440 million budget means that there will be more funding available than ever before for businesses across the country to bid for and help turn their ideas into reality - bridging the so called valley of death," said Universities and Science Minister David Willetts.
"The TSB is making a real difference in driving growth and keeping the UK at the forefront of the global race for innovation. Over 60 percent of funding is going to small and medium sized businesses, meaning that there are great opportunities for businesses to thrive, grow and generate jobs."
The priorities for investment have been set out in the TSB's 2013-14 Delivery Plan. In the 'Digital Economy' category, the TSB will commit up to £10 million to the Connected Digital Economy Catapult and up to £37 million to 10 competitions.
The focus will be on exploiting data, new value models, resilient and interoperable digital systems, linking services to customers, and supporting the implementation of the government's Information Economy Industrial Strategy.
The largest single area of investment will be visual effects capabilities and work processes that allow audiences to be reached across multiple platforms. Up to £15 million will be invested in feasibility studies and a collaborative R&D competition.
Meanwhile, enterprise and employee information systems that help businesses to establish secure and resilient connections with their staff working remotely, and location-based services that help businesses engage with their customers in their 'here and now' context will each get £4m investment.
The TSB said that it would also develop and expand initiatives designed to support SMEs. Fpr example, the budget for the Small Business Research Initiative (SBRI) will be increased to £100 million in 2013/14 and £200 million the following year, giving SMEs access to public sector procurement contracts.
The innovation vouchers scheme, which gives businesses the chance to access specialist expertise, will also be expanded, and the SMART awards budget, at £40 million, will continue to provide SMEs with grants to allow them access to new markets and invest in R&D.
"Everything we do is driven by the desire to help UK business bring new ideas and technologies to market and so support economic growth," said Iain Gray, Chief Executive of the Technology Strategy Board.
"The UK is a dynamic, innovative place to live and do business. The Technology Strategy Board aims to make it the very best place to innovate."