Applications have opened for the Government's technology development grant - part of the $321 million in new science and research and development funding declared in this year's Budget.

Almost $190 million has been allocated for the grant over the next four years, with $22.5 million available this year.

To be eligible for the funding companies must already be intensively engaged in R&D and have had an annual revenue of at least $3 million for the past three years.

Before applying, firms must first register with the Foundation for Research, Science and Technology, which is responsible for the grant.

The registration period closes on Friday.

Twenty per cent of a firm's R&D expenditure - up to the value of $2.4 million a year, excluding GST - will be reimbursed through the technology development grant.

A foundation spokesperson said 96 companies had already registered for the funding, of which 69 had been deemed eligible.

Successful applicants would be announced in early December.

One of New Zealand's biggest R&D spenders, Manukau-based Fisher & Paykel Healthcare, has registered for the new grant.

The company employs a 300-strong research team - projected to double by 2015 - and spent about $35 million on R&D during the past financial year.

"We'll definitely be putting an application in," said chief executive Michael Daniell yesterday.

If F&P Healthcare's application was successful, he said, the funding would be used to expand R&D in the two main areas of the firm's business - respiratory and acute care and devices for the treatment of obstructive sleep apnoea.

This year Daniell said he believed the old R&D tax credit scheme, which was scrapped by the National Government, had been more beneficial to the company than the new scheme would be - saving it about $4 million during the time it operated.

But yesterday he said the reduction in the company tax rate, announced in the last Budget, coupled with the technology development grant, would likely have "a similar effect" to the previous scheme.

Smaller firms that find themselves ineligible for the technology development grant will be able to apply for technology transfer vouchers from November 1.

The Government has set aside $20 million for the vouchers, which small companies will be able to use to access R&D at public research institutes and universities.

The new science spending also includes $23.7 million for commercialising public research, $25 million to assist "talented scientists" and $44.3 million to expand infrastructure.

ANGEL INVESTMENT SETS A NEW RECORD

New Zealand angel investment has hit a new high, with a record $52.2 million pumped into local start-ups in the year to June 2010, according to the latest Young Company Finance Index.

The previous record was $42.7 million in the year to June 2009.

New Zealand Investment Fund chief executive Franceska Banga said the high level resulted from increasing numbers of angel groups and investors.

"Angel investors are making new investments but also supporting existing investee companies as they grow. As more companies are invested into, more companies are receiving follow-on investments, providing a snowball effect."

Angel Association New Zealand executive director Colin McKinnon said that while the future looked bright, a "capital gap" still existed for companies needing second-stage funding in the $2 million to $5 million range.

Angel groups rarely invested more than $1 million in a single company, meaning successful start-ups must often approach venture capitalists for more substantial funding.

He said the $50 million the fund recently made available to establish new VC funds targeting companies requiring $2 million to $4 million might help address the capital gap.

Sixty-four deals were clinched between start-ups and angel groups in 2009, the index said, while 35 had already been completed this year.