"I will point out that we feel he should stay and I will be emphatic when I make that statement to him."

He added: "I think the point where we can reach Rio is the fact that he loves to play football.

"Rio is an outstanding player and there has got to be an awful lot of credit to Leeds for paying out �18m when a lot of people frowned on it."

Venables confirmed Leeds chairman Peter Ridsdale had made it clear he had to sell - but he will have cash to spend in the transfer market before the start of the season.

He said: "We know that if we could we'd like to keep them all but the reality is we have to deal with certain situations.

"Peter has mentioned there is �15m to be found and I took the job on that understanding. We will do whatever we can to satisfy that side of it."

Venables is convinced Leeds have the potential to challenge for trophies, adding: "This is the reason to come here, this is what makes it exciting. I did not want to do the job for the job's sake.

"I think Leeds United have the potential to go right to the top. Potential is one thing and making it a reality is another. We have the drive in the squad and the club to go right to the top.

Ridsdale claimed he was "insulted" by the claims surrounding O'Neill and sprung a surprise on the clearly startled Venables.

He said: "There is no doubt at all that by the time the season starts money will be available for Terry to bring in new players."