SFA holds up Smith's return to Rangers

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Rangers and the Scottish Football Association remained at loggerheads last night as Walter Smith's seemingly inevitable return to club football was put on hold.

There seems little prospect of Smith returning to work for the SFA, given his stated desire to return to his old job at Ibrox. And it is understood that Rangers remain confident that Smith will return to the club he led to seven league titles, however long the impasse might last.

However, the SFA was last night clinging on to the manager who is under contract to them until the end of the Euro 2008 qualifying campaign. It is in the SFA's powers to make life difficult for Rangers, and for Smith, if it so desires.

As discussions continued behind closed doors at the SFA yesterday, it was hard to imagine they focused on anything but the compensation treasure chest which might be unlocked if Scotland release the man who has revived the national team's fortunes.

Figures ranging from £200,000 to £600,000 have been bandied about, yet both would be small consolation for the SFA if the momentum gained under Smith dissipates under a successor.

And such sums would be laughed off by, for instance, Derby if the SFA was to ask for permission to speak with Billy Davies about replacing Smith.

It is believed that Derby paid more than £500,000 in compensation to Preston only last June to secure Davies' services, since when his stock has risen further.

Assuming there is no U-turn from Smith, Tartan Army supporters and the SFA may have to reconcile themselves with losing a top-class coach and then taking a punt on one of the brightest home-based managers.

Craig Levein of Dundee United might have struggled in the Championship with Leicester but with the Tannadice club - and with Hearts and Cowdenbeath beforehand - he has gathered a legion of admirers.

He would command support, as would Tommy Burns, a long-standing servant of the national team who has worked under Berti Vogts and Smith.

There are also cases to be made for Alex McLeish, who has been out of management since leaving Rangers at the end of last season, and Gary McAllister. Neither man would require a compensation payment which might appeal to the SFA power-brokers.

Scotland and Rangers were reluctant to update on whatever progress had been made since yesterday's meeting at Hampden Park.

The SFA insisted there was "no change" but this was a deadlock with only one foreseeable conclusion.

Within minutes of Paul Le Guen resigning as Rangers boss last week, Smith emerged as favourite for the job. After a difficult spell with Everton, he has fully restored and arguably enhanced his reputation with Scotland. Smith's side surprisingly top their group, ahead of Italy and France, the two World Cup finalists.

They have come so far under Smith that to lose him at this stage would be agonising. SFA chief executive David Taylor insists that Smith understands the SFA's stance, even if it goes against his wishes.

Celtic's reserve team coach Kenny McDowall quit the club to join Glasgow rivals Rangers on Tuesday in a move reported by local media to be linked with Smith's expected return to Ibrox. Celtic stated on their website: "Celtic can confirm that Kenny McDowall will be leaving his position with immediate effect. The club thanks him for his contribution at Celtic."