The Three Lions chief, whose contract expires at the end of Euro 2016, is understood to be keen on extending his stay with England into the World Cup in 2018
Former Manchester United defender Neville is on the 67-year-old’s coaching staff and Butcher insists Hodgson should continue to nurture the ex-Red Devils star.
Germany’s recent success under Joachim Loew has been partly attributed to Jurgen Klinsmann’s tutelage of the former Austria Vienna man.
And Butcher believes the system of replacing managers from within the ‘boot-room’ will benefit England in the long run.
“Roy Hodgson’s a good figure, he’s strong but very approachable,” the 77-cap former skipper told the Alan Brazil Sports Breakfast show. “He puts his arm around people.
“He’s grooming Gary Neville on his staff and he could be England manager when Roy calls it a day.
“We’ve never had that with England. Germany did that and look what happened to them. It’s very positive.
“It might be a bit premature to talk about a new contract but you need some stability. The players need to know which manager is going to be there.
“Roy’s done a very good job for England, even though the World Cup wasn’t particularly great in Brazil.”
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