The midfielder was initially told he had played his last game for the Ibrox club when he was stripped of the captaincy for his part in the 'Boozegate' affair which ended his Scotland career.

Smith then had a change of heart about the player's future at Rangers only for Ferguson to suffer a calf tear just two minutes into a reserve match last month which appeared to bring his season to a premature end.

However, the 31-year-old was back in training with the rest of the squad at Murray Park earlier today.

And, although unlikely to have any part to play in Saturday's Old Firm derby, Smith does expect him to feature again this season.

He said: "This was his first day back training with the rest of them and was a lighter day's training.

"He is progressing but needs a few more days' training before he is up to match fitness.

"I would hope that would be in the next few days so obviously Saturday's game comes a little bit too early for him.

"Lee McCulloch had the same injury and, when he came back, he went back out with the calf strain again.

"But hopefully once Barry comes back that will be him fit and he would be fit for us in the remaining games of the season."

Meanwhile, Smith claims he has "no problem" with assistant referee Tom Murphy running the line in Saturday's showdown with Celtic despite comments made earlier this season.

Smith was furious when the linesman disallowed a Kris Boyd goal for offside in a goalless draw against Motherwell back in November.

Speaking at the time he said: "We didn't finish well and the one that we did finish through Kris Boyd was a poor decision from the linesman. I think it was quite clear it was onside.

"Mr Murphy was quick to allow a Scott McDonald goal at Celtic Park and was quick to disallow that [Boyd goal]."

The Rangers boss escaped punishment from the Scottish Football Association for the remarks and insists the incident is now firmly in the past.

"I've got no problem with anybody officiating the game," he said.

"Whatever I said about Mr Murphy before is finished with now.

"He has officiated at other matches we've had since the Motherwell game and I've got no problem with him officiating in this one."

Celtic boast a single point advantage at the summit of the Clydesdale Bank Premier League heading into the clash at Ibrox.

And, while acknowledging the importance of the game, Smith insists branding the encounter a "must-win" game would be disrespectful to the other teams still to face the Old Firm this term.

"It would be showing a disregard to all the other teams if you were to say that was the case," he said.

"We have three games to play afterwards and the teams we have still to play have all given us extremely difficult matches over the season.

"Sometimes I think, with the focus on the Old Firm, that gets forgotten.

"I don't think there is any getting away from the fact it's a vitally important game for both the teams if they hope to win the championship.

"But you always have to keep in mind that you have to show respect for the games you have left as well."

Asked what fans can expect when Celtic come calling, Smith added: "That's the one thing about the Old Firm games, you never know.

"Whatever plan you set out, you usually find it can change quite quickly.

"This is obviously a very important one and we are bound to see a little bit of tension, some nerves. It's natural, if you didn't have that, there would be something wrong.

"I hope we see a good game. A lot of the matches we have played recently have been, in my mind, excellent games.

"I don't agree with a lot of criticism that has been placed in front of the Old Firm for the manner in which the games have been played.

"I think some of the recent games have been excellent."