A failed comedy festival will be given an extra $91,784 of taxpayer money to cover its unpaid bills, bringing the total granted from the state's purse to $211,784.
In May The Examiner revealed a number of artists and staff employed by the festival had not been paid, despite Laughs of Launnie already receiving $100,0000 of their $120,000 grant.
At the time, a government spokesman said the liability to unpaid artists was the organisers' responsibility.
"The payment of staff, performers and suppliers is a matter for the organisers and the government expects that they will all be paid in full," the spokesman said.
But less than six weeks later the government is preparing another grant for the company to pay its creditors.
Treasurer Peter Gutwein said in order to ensure local businesses were not disadvantaged and Tasmania's reputation and brand was not damaged, the government would pay the outstanding accounts.
"While the Laughs of Launnie festival saw some of Australia's best comedic talents perform in Northern Tasmania, unfortunately it failed to attract the attendance numbers anticipated and as a result, a number of local businesses including caterers and venues, as well as national and international performers have not been paid," Mr Gutwein said.
The company received a State Growth Department grant of up to $120,000, with the final $20,000 to be handed over with the $91,784 once the contract between the company and the Crown was finalised.
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Laughs of Launnie directors Scott Plummer and Chris Franklin did not respond to questions about how many people and businesses were owed money but issued a statement.
"The remaining two directors have been working extremely hard to resolve all issues of shortfall since the completion of the festival through government and private sectors," it read.
"We are extremely appreciative of the government's assistance in ensuring all creditors will receive all monies owed."
The Treasurer's spokesman said the original grant was provided to support organisers test the viability of the concept of an international comedy festival in Launceston.
"These funds were used to meet costs associated with the delivery of the event, such as venue hire, marketing, programming and professional fees," he said.
"Whilst the government is disappointed that further funding is required, in the interests of ensuring that local businesses are paid and our brand protected a further $91,784 will be provided to enable all outstanding creditors to be paid."
Laughs of Launnie was held across multiple venues from March 18 to 24.