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Last Updated: Wednesday, 1 December, 2004, 11:45 GMT
Q&A: Where Band Aid money goes
A new version of the Band Aid song Do They Know It's Christmas? and a DVD of the Live Aid concert are expected to be big sellers in the festive season. Where is the money going?

Does 100% of the money go to charity?

1. 1.83 - straight to Band Aid Trust charity
2. 60p - VAT to be given to charity by government
3. 1.10 Retailer's cut. How much goes to charity depends on the retailer and how many are sold
4. 46p - Record company costs eg manufacture, distribution
Source: Band Aid Trust
No. The bottom line is at least 2.43 from each 3.99 CD single is going to charity, but it may rise to 3.53.

Record company Mercury and the Band Aid Trust say 1.83 goes straight to charity. Another 60p will be paid in VAT then refunded to the Trust by the government.

Record shops would normally keep a 1.10 slice. But most big chains - including HMV, Virgin Megastores, Woolworths, Tesco, WH Smith and Sainsbury's - have agreed to give their profits to charity.

But it is not as simple as giving 1.10 back per CD. Shops have bought huge quantities from Mercury and need to sell enough to cover those costs before breaking even.

Only then would any profit go to charity - so the more copies sold, the more likelihood there is of shops making a profit, and the higher that amount is likely to be.

The other 46p in the 3.99 covers the record company's essential costs - such as manufacturing, labels and distribution, which are all done by the company itself. Mercury is not making any profit from the CD.

But lots of people who would normally be paid have given their time and effort for free - from the singers and musicians themselves to PR people, artwork designers, shops that have done marketing activities and TV stations and magazines who have donated advertising space.

What about internet downloads and mobile phone ringtones?

The new version of Do They Know It's Christmas? is being sold for 1.49 to download, or for 1.99 they will throw in the original 1984 version too.

But unlike CD singles, there is no manufacture and delivery process so almost every penny goes to charity. The same goes for ringtones, with telephone companies giving most proceeds to charity.

How much will be raised for charity?

If a million copies of the CD are sold, the total proceeds going to charity, including funds from downloads and ringtones, could be about 3m - depending on where they were bought.

What about the Live Aid DVD?

Live Aid
A DVD of the 1985 Live Aid concert has just been released
As with the single, the full price you pay does not go to charity - but it is impossible to say exactly how much does.

Warner Vision International won a bidding war for the rights to release the 1985 concert for the first time, paying an unspecified but "huge" sum in the millions, they say, to the Band Aid Trust.

On top of that, they are paying an "above-standard royalty rate" that will go up as sales increase.

Record shops and other retailers are taking some of their cut. They pay up to 27 per four-disc set and would normally keep the difference between that and the price fans pay. But shops are believed to be making an unspecified "fixed contribution" to charity for each DVD sold.

Internet retailers are the cheapest, selling the DVD for 27.99, with prices elsewhere rising to the recommended retail price of 39.99.

What will the charity money be used for?

Bob Geldof in Ethiopia in 1985
The Band Aid Trust has been funding projects in Africa since 1985
The Band Aid Trust has been going since the original single was released, handing out $144m (75m) to famine relief projects across Africa between January 1985 and November 2004.

Of the latest money raised, a Band Aid statement said: "These funds are distributed to various organisations that implement sustainable projects aimed at relieving poverty and hunger in Ethiopia and the surrounding area via a funding process.

"This involves inviting organisations to submit proposals to the trustees for consideration - those projects that meet the Trust's objectives and the approval of the trustees are funded.

"The progress of each project is monitored by the trustees through the receipt of regular reports from each of the charity organisations funded."

  • A documentary about the making of the single, Band Aid 20, is on BBC One at 2235 GMT on Monday.


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