Venables, who left his England post after leading the team to the semi- finals of Euro 96 and then joined First Division Portsmouth in the role of director of football, had another meeting yesterday in London with David Hill, the chairman of Soccer Australia.
Venables, 53, who stands to increase his England salary by 30 per cent, would not confirm he had taken job. "We are still talking. So I do not want to say much more at this moment," he said. But he has made it plain that one of his remaining ambitions is to be involved in a World Cup.
Soccer Australia believe Venables is the man to elevate them into mainstream international football and it is likely they will allow him to continue his role at Portsmouth. The new job will require him to spend much of his time in Europe monitoring the leading Australian players who play their club football here.
"China, Japan, Korea and teams like that are emerging fast and I think Australia are another country that want to get involved big time in world football," Venables said.
"My knowledge is not as up to date as Eddie Thomson's, the last manager but I've spoken to him and he has been very helpful. Anyway we'll have a fair idea fairly soon."
Australia are in the Oceania qualifying group and, if successful, would have to beat an Asian qualifier in a play-off to reach the last 32 in France.
Chelsea, not content with having just spent pounds 4.5m on Gianfranco Zola, are now considering parting with another pounds 3m for the Fortuna Dusseldorf keeper Georg Koch.
"We are in talks with Chelsea and if we get the money then Koch will be sold," Jurgen Hauswald, the Dusseldorf president, said. "Chelsea are building a world class team. Georg would be mad not to go there with the money on offer."
Chelsea are understood to have offered Koch a five-year contract worth pounds 8,000 a week.
Tony Parkes has been told that he will be in charge of Blackburn Rovers for at least the next month as they continue their search for a successor to Ray Harford. Rovers were turned down by Venables and attempts to interview managers Howard Kendall, Peter Reid and Bruce Rioch was blocked by their clubs.
Extraordinary goings-on in Carlisle have left the chairman and chief executive Michael Knighton reconsidering his decision to quit the Third Division club following a dispute with a newspaper over a story about his experience with a UFO at a motorway filling station. The story was headlined: "Knighton: Aliens Spoke To Me".
Knighton claimed that the report of the incident 19 years ago was the final straw in a "negative campaign" against him by the Carlisle News and Star and said he would leave at the end of the season. "When the relationship has deteriorated to this level, it's time to call it a day," he added. However, a front-page plea by the paper led Knighton to think again.
Cyprus has emerged as the most likely venue for Scotland's rearranged World Cup qualifier against Estonia, with 11 February the probable date. Confirmation is expected this week. Owing to a rearranged kick-off time the Estonians failed to turn up for last month's game in Tallinn. The severe winters in the Estonian capital has ruled out a return there.