Record's VAT goes to aid Haiti victims

Prime Minister Gordon Brown pledged to make sure the tax from sales of the star-studded hit would go to victims of January's disaster in an attempt to boost sales.

Aid agencies were alarmed however when it emerged the bill for the lost revenue was being paid initially by the Department for International Development (DfID).

Political opponents accused Mr Brown of a "sleight of hand" after reports of disquiet among DfID officials at the arrangement. But Downing Street insisted the arrangement was procedural and that the aid budget would be fully reimbursed by the Treasury.

Number 10 said the VAT had to be collected under EU law but that all the promised proceeds would go to Haiti and no other development efforts would suffer. "No money raised for Haiti will be deducted from other development projects or the DfID budget," it said in a statement.

More than 200,000 people were killed when the impoverished Caribbean republic Haiti was hit by a quake in January.

The single, a cover of REM song Everybody Hurts, was masterminded by pop and TV mogul Simon Cowell and sold more than 600,000 copies.

Proceeds were split between the Disasters Emergency Committee (DEC) and The Sun newspaper's Helping Haiti campaign.