ACT Chief Minister Katy Gallagher used her annual State of the Territory address on Thursday to launch a $4.4 million digital action plan for Canberra, including roll out of the Wi-Fi network in the CBD from the second half of this year.

Negotiations are underway with industry to deliver the network, which will also include a trial of free Wi-Fi on Action buses.

The service vendor will use the network for promotional activities.

It comes as the ACT government seeks to "transition Canberra to a modern digital city".

Ms Gallagher told a business lunch at the National Gallery of Australia that free Wi-Fi networks would also be rolled out in other town centres and commercial precincts in the ACT. At the last election, Labor promised free public Wi-Fi in all town centres, bus interchanges and buses by 2016.

"Once complete, the territory's network will be the largest free outdoor public network in Australia," she said.

"While not a service for business directly, it will create yet another incentive to be active online and engage with fast-growing digital media channels.

Under the plan, Civic's Garema Place will be developed as a centre of digital innovation with a new dedicated digital space and digital screen.

A new digital and innovation service centre will also be developed to provide "incubation" for digital ideas.

Ms Gallagher said the plans would come at a low cost to the taxpayer and would help promote 21st century work and leisure models in Canberra.

"[Garema Place] will create a new forum for the meeting of creative minds and creative digital ideas in the city," Ms Gallagher said.

The government will invest $80,000 to assist business in adapting to the digital economy, and will offer grants totalling $225,000 for training through targeted private sector internships.

A new panel will receive digital innovation pitches for projects that the government will consider.

Ms Gallagher said the government was planning for "various scenarios" coming from May's federal budget, expected to provide a bleak outlook for the national capital.

She said last week's two-year stimulus package for the ACT property and construction sector would bring $500 million in positive effects to the local economy.

The upcoming ACT budget would include growth in infrastructure and workforce in health, a transition to the National Disability Insurance Scheme, increases to ACT government school resources and the continued delivery of efforts to reduce obesity.

"Whilst we may be the smallest government in Australia - we don't lack ideas," Ms Gallagher said, "nor courage; nor the willingness to cast aside the misperceptions of others and lead the way on big changes which will have long-term payoffs for our community."

The announcement was met with praise from Canberra marketing agency contentgroup.

"The plan is smart, it's right, it's timely and above all else it will work," chief executive David Pembroke said.

"While there is still some meat to be put on the bones, the shape and direction of the plan suggests to me that if the private sector and everyone in Canberra gets behind it, it will have a significant impact on our local economy which at the end of the day will mean more people in work."