McAllister, who was flattered to be offered the job, is instead holding out ofr another post at club level.
“Firstly, it goes without saying that I was flattered to be asked by George during what was an informal chat last week,” he told The Herald.
“But to be honest, at this stage of my coaching career, I think it is more important to hold out for a full-time job at club level.
“I don’t really want to elaborate on that because of the sensitive nature of the situation but I have a great deal of respect for George Burley and when he asked me to have a chat about it, I was keen to hear what he had to say about the role.
“As a former Scotland captain, I would have been immensely proud and honoured to have worked with the international set-up again and try to get the country into a major championship final again.
“I have a couple of irons in the fire down here and the major attraction is that they are full-time posts so I had to bear that in mind. I wish George all the best for the future.”