Liverpool boss Rafa Benitez admits they've been second best to Everton in capturing the area's best local talent.

Liverpool has missed out on Wayne Rooney, Jack Rodwell and James Vaughan in recent years.

Benitez said: "In my first few years at Liverpool I was waiting and waiting for players to come through from the Academy and I was unable to have an influence because the youth system was not part of my job.

"That's why, when I was negotiating my new five-year contract, it was not about money or more power. It was about influencing the academy. Maybe in the future we will not have the money the other top teams have, so we have to produce our own players.

"If that is going to be the case then I wanted to have an influence on player development because I need to have that talent coming through.

"If you bring your own players through they have more passion and commitment to the club, like Jamie Carragher and Steven Gerrard."

Benitez added: "We must start to develop local players and that's why Kenny Dalglish can be so important to our future.

"With his experience and contacts he can bring in a lot of people. He is a legend here. Now we are in a good position."