World Cup 2010: England manager Fabio Capello holds 'positive' talks with FA

A source close to the discussions, who did not wish to be named, said they were "very positive" and both parties are hoping to bring a close to the matter by the time the team departs for South Africa.

It is understood that improving the terms of the contract is not on the agenda and discussions will only deal with removing the release clause inserted in Capello's contract when he was appointed England manager.

The clause allows for either party to be released from the agreement after the World Cup.

Richards and Capello spoke on the telephone rather than face-to-face, which has also been taken as a positive indication.

A higher priority for the Italian is cutting his pre-World Cup squad from 30 to 23 on Tuesday.