Fabio Capello to continue as England manager, FA reveals

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The surprise news emerged today following a meeting of the Club England Board. The Italian had been expected to lose his job after England's dismal showing at the World Cup where they were beaten 4-1 by Germany in the second round last weekend.

After the defeat, the Football Association announced on Monday that they would take two weeks to decide whether the 64-year-old would carry on until the end of his contract in 2012. That development led many to believe that the FA were looking for a way out of their deal with Capello, who is paid around £6million-a-year.

The Italian insisted he would not quit despite speculation that the England squad had been rife with division and in-fighting during their stay at the training base in Rustenburg.

But the Club England Board of Sir Dave Richards, Alex Horne, Sir Trevor Brooking and Adrian Bevington decided that Capello was still the right man for the job. The coach insisted that he would now make changes starting with the friendly international with Hungary next month.

England's first qualifier for Euro 2012 in Ukraine and Poland is against Bulgaria on 3 September and Capello said: "I am more determined than ever to succeed with the England team.

"Sir Dave Richards has called me to tell me everyone at The FA wants me to continue. I explained it is very important we use the disappointment as a motivation in the future.

"I can assure the fans I am now fully focused on our European qualifying fixtures, starting with the friendly against Hungary in August.

"We will look to introduce new players to give the team new energy and I will use all my experience to take England forward.

"I am extremely proud to be the England manager, it means so much to me and I am determined to succeed."

The Club England Board considered all aspects of England's performance and operations at the World Cup.

Chairman Sir Dave Richards said: "We are all still extremely disappointed at our performance in South Africa, and we believed it was important that we took some time to reflect on everything in a calm and considered manner back in England. After fully discussing our performance we remain convinced that Fabio is the best man for the job."