The National Broadband Network is jostling for access to millions of dollars in state government innovation money in a bid to fund upgrades as the federal budget comes under pressure.

The NBN Co is in discussions with major state government departments, such as health and education, to improve speeds and connectivity, sources from the network and telecommunications industry said.

NBN Co CEO Stephen Rue will deliver the network's financial results on Tuesday. Credit:Edwina Pickles

The taxpayer-funded internet provider is also hoping to secure more projects across the country by pointing out to state governments that budgets for major NBN upgrades could come from "innovation funds", the sources said.

State governments have increasingly set aside large sums to help boost start-ups and businesses, with NSW launching a Digital Restart Fund in the 2019-20 budget with seed funding worth $100 million over two years. These types of funds are considered a partnership "opportunity" by NBN executives, who have long argued that connectivity helps improve productivity.