Arsenal created a new record last Monday with a full house of foreign players in their 16-man squad against Crystal Palace.

My first reaction echoed that of most English managers - this can't be right.

I had to temper that slightly when reminded that, back in 1978, I was probably the first to play one of the new breed of foreign imports when I signed right-back Ivan Golac from Partizan Belgrade. He arrived in the same week as Argentinians Ossie Ardiles and Ricardo Villa at Tottenham, but Ivan got his work permit first and made his debut in a midweek game - a few days before them.

Without doubt, Ivan was one of the best £50,000 buys ever in the top flight. He was also the first foreign player in a Wembley Cup Final since Bert Trautmann of Manchester City, when he turned out for us in 1979 against Nottingham Forest.

The problem with too many foreigners in the same team is firstly that it can knock the confidence of young British players in the same club.

No matter what anyone says, cliques and separate groups are very easily developed. Having said that, one of the strengths of Chelsea at present seems to be the magnificent team spirit which is undoubtedly generated by English players Paul Terry and Frank Lampard.

In fact Chelsea, before the arrival of Messrs Abramovich and Mourinho, played 11 foreigners in a Boxing Day game at Southampton a few years ago.

As an ex-international manager, I feel there is no doubt that the current trend of the big clubs managed by foreigners will eventually have an effect on the England team.

I know from first hand, having spent six years with England and Northern Ireland, that we are a very club-orientated country where even British managers have been loath to release players during the season, particularly for friendlies, B and under-21 games.

Most supporters would also want their club team to be at its strongest, especially when they are fighting to get into Europe or to stay up.

While everyone likes to watch England perform in the tournaments every other summer, expecting them to get to the final stages every time, if the present trend at club level continues we could well slip down the world rankings.

Spain are often quoted as having some of the most exciting players in their domestic league, but if you examine the likes of Real Madrid, Barcelona and Valencia etc, they, too, have a large percentage of foreign imports. As a result, the national team rarely excels on the big stage. Closer to home, I can remember when Scotland qualified on a regular basis for the final stages of the World Cup. They used to be a shade or two behind England. Now they are just ahead of the likes of Northern Ireland.

Examine the big clubs in Scotland and the vast number of foreign players fielded by Rangers and Celtic tells its own story.

Once a regular stream of highly-talented Scottish players crossed the border. When was the last one to have any great effect on our Premiership?

When I took over Northern Ireland, they ranked about the 100 mark. We got down into the 80s but now they have no chance of reaching the final stages. The Scots and Welsh are arguably in the same category.

Recently an ex-manager told me he had been approached about advising the Iran national team. When he looked at their world ranking, he found them in the top 20.

I recently watched the Iraq national team who got to the Olympics semi-finals. Not only can these teams play excellent football, they are fit, strong and willing to learn and will undoubtedly start to become prominent in international competitions. There are no foreign players in their domestic football.

So what's the answer?

An obvious one is to limit the numbers of foreigners, as in cricket. UEFA are trying to introduce a rule requiring clubs to submit a squad of about 24 players which must have a percentage of home-grown talent.

This will only apply to European club competitions, however, and the big question is what denotes home-grown talent.

Arsenal, for instance, are bringing French youngsters into their academy and, unlike youngsters from other parts of the world, they won't need work permits. So it probably won't bother them at all.

Also, it is slightly worrying that our national manager, nice man and good friend of mine that he is, doesn't appear unduly concerned that Arsenal select 16 foreigners.

But it is something which has to be addressed.

On the one side, we have our biggest clubs often financed by foreign money, managed by foreign coaches and more concerned with qualifying for foreign competitions with supporters just happy to watch a winning team. On the other side, there are concerns from the PFA, the LMA and surely parents of youngsters with the decision to make about whether their talented son signs for Chelsea or Arsenal or goes instead to Millwall or QPR, where he may have a better chance of playing.

Lots of hot air is expelled each year about the quality of our academies. But the real test is how many youngsters come through the set-up and then go on to play in the first team on a regular basis.

If the answer is hardly any, then they are a complete waste of money.