A SCOTSMAN'S ambitious plan to create a Lakeland distillery producing English malt whisky has foundered.

Andrew Currie, the man behind the project, has admitted that financial problems have scuppered his dream of establishing the first distillery in the Lake District - and only the second in England - in the former wood mill at Staveley.

Mr Currie said he had no money to save the Staveley project - even though he previously received a grant of £89,000 from Cumbria Vision, £7,000 in advanced sales of whisky and a £140,000 personal' loan from an Irish brewing company.

Mr Currie claimed he had stopped selling whisky in advance of production once it became clear the Staveley project was no longer going ahead. He said the Staveley scheme became doomed when the company he employed to arrange the supply of specialist fermentation and distilling equipment "failed to deliver".

The former Uppingham public schoolboy, who once worked as a journalist for the BBC World Service, said: "I can confirm that plans for a distillery at Staveley Mill Yard will no longer go ahead."

David Brockbank, owner of Staveley Mill Yard, said: "Nothing would have pleased me more than to see the distillery up and running at Staveley, alongside other innovative businesses that have set up on the site."

Cumbria Vision spokesman Luke Dicicco said: "Cumbria Vision awarded Lakeland Distillery a grant of £119,747 to set up in Staveley Mill Yard.

"The North West Regional Development Agency's legal team is now in the process of clawing back the £89,428 that has already been spent. The offer of unspent funding has been officially withdrawn.

"Cumbria Vision is disappointed that the project is no longer going ahead after being as flexible as we could to make Lakeland Distillery a reality."