United began their season with a 2-1 win over Leicester City at Old Trafford last week. "I saw that news came out, but I do not know where it came from".
Not much has been heard from the French World Cup victor since then although there were whispers that he was placed on a shortlist by Manchester United management as a backup should Mourinho decide to depart Old Trafford.
But Townsend believes he poor displays are not entirely his fault and he would flourish in a more attacking side like City.
It is, however, possible for players to leave teams in the Premier League for other teams i.e.
"If he was across the road in a light blue shirt, my goodness, I'm telling you now he would be better than he is".
United legend Scholes made over 700 appearances for the club and won 11 Premier League titles in his 19 seasons at the club.
He told The Mirror: "When you look at Manchester City, possibly Liverpool, I don't think [United] have the quality of those two teams at the minute".
Manchester United managed to acquire the services of Fred from Shakhtar Donetsk and Diogo Dalot from Porto in the summer transfer window, leaving Jose Mourinho frustrated at the fact that the club couldn't make more signings for "unknown reasons".
Reportedly, the Spanish director, who arrived at Roma only 18 months, is seen as a hard target given he only just arrived at Roma. The report goes on to state that the favoured destination for the former Real Madrid manager is Manchester United.
"You don't really know the team, you don't really know the players, you don't know how they're going to perform from one week to the next".
"I don't see them challenging for the league this year".
A return to Chelsea yielded Premier League and League Cup trophies before he left Stamford Bridge for a second time halfway through his third season at the club, with the Blues 16th in the division following a dismal run of nine defeats in 16 games.