A spokesman for Tourism Minister Gail Gago said all outstanding debts would be paid within seven days.

The assistance package will ensure that creditors, including 16 Kangaroo Island businesses, will be paid.

After a series of emergency meetings last week, Surfing SA had informed the SA Tourism Commission that up to $500,000 remained to be paid from the November surfing event and music festival.

A SurfingSA spokeswoman said on Tuesday that the event’s organisers, chief executive officer Steve Reddy and publicity officer Tim Doman, no longer worked for the organisation after last week’s meetings.

One of the event’s major sponsors, Kangaroo Island Sealink, had agreed to write off debt owed to it and Surfing SA has sought additional funds from the sport’s national governing body, Surfing Australia, to ensure it can meet all of its liabilities.

The State Government bail-out funds will be drawn from within the SATC’s existing budget. As a condition of the package, the owners and managers of the event, Surfing SA, were required to settle the outstanding liabilities arising from the event within seven days of receiving the money.

“The assistance is an emergency response to unique circumstances in which a significant number of local businesses were facing financial hardship,” the department spokes-man said.

“Many of those owed money are small businesses on the Island and Surfing SA is in no position to meet these liabilities

“I am advised that SATC had met all of its contractual obligations under the agreement and had no requirement to make this contribution to Surfing SA’s losses on the event,” the spokesman said.

The event attracted 4000 people attending over six days.

The spokesman estimated it boosted the local economy by almost $3 million and said live images of the event and the Island were broadcast on digital channel Fuel TV and via the internet, across the world to an audience of up to one million.