But local mayors rejected the offer, saying they will defend their territory at any cost.

"The government guarantees the availability of compensation funds for a total of 14 million euros (20 million dollars) for Terzigno," Berlusconi said at a press conference, following an emergency meeting with ministers.

The talks came amid escalating clashes between police and residents of the Naples area who were protesting plans for the new Cava Vitiello tip to be built in national parkland area, where there is already a dump.

Critics have accused Berlusconi of failing to keep his promise to resolve the garbage crisis in the Naples area, which he made during his election campaign in 2008 and helped to win him the vote.

Angela Borelli, mayor of the nearby town of Boscatrecase, said Berlusconi had dragged the situation out in an attempt to tire the protesters, but the community was determined to fight the new landfill at any cost.

"We will defend our territory to the last, to the death," she told reporters.

Gennaro Cirillo, mayor of Trecase, said the government in Rome continued to argue over whose fault it was while the suburbs of Naples were caught up in "a new intifada."

Apart from the funds for Terzigno, some 20 kilometres (12 miles) southeast of Naples, Berlusconi said plans for incinerators in the area would be speeded up.

Berlusconi also said he would send the head of Italy's civil protection agency, Guido Bertolaso, to Naples later Friday to deal with the problem.

But the mayor of Terzigno, Domenico Auricchio, said the community wanted to stop the new tip from being built, not compensation.

"We're not interested in money... we have only one objective: to prevent the opening of Cava Vitiello," he told the press after the conference.

Gennaro Langella, mayor of Boscoreale, said on CNR radio: "We don't want the money.... Our health doesn't have a price."

The new dump would be 800 metres (yards) from the edge of Terzigno in the Vesuvius National Park, around 135 square kilometres (52 square miles) of outstanding natural beauty in the Bay of Naples.

The protected area of rare wildlife and plants includes Mount Vesuvius, best known for its eruption in 79 AD that destroyed the ancient Roman cities of Pompeii and Herculaneum.

The plan to build Europe's biggest garbage dump just eight kilometres from Pompeii is "an abuse by the state" and against the law, park director Ugo Leone, a professor of environmental policy at Naples university, told AFP in a telephone interview after the government meeting.

"From the beginning we have opposed this by all legal means possible," he said, adding that he was "in absolute agreement with everything that the citizens of the area and the environmental groups are saying."

Residents have held almost daily sit-ins over the last month to call for the closure of the current tip, which they insist is full to overflowing and causing health problems, particularly in young children.

Piles of malodorous garbage have also been accumulating in the city of Naples itself, raising fears of a repeat of the impasse in 2007 and 2008 that saw tens of thousands of tonnes of untreated waste accumulate around the city.

The long-running issue has been blamed on a lack of local incinerators, and landfill sites controlled by the local mafia, the Camorra, some of which were used for the illegal dumping of toxic waste.

The groups of masked residents rioting in the streets of Terzigno are not the only protesters.

Non-violent campaigners include the "Vesuvian Mothers" group, a band of local mothers who have spent the last few weeks demonstrating daily with their children.

They say life in the vicinity of a tip is unbearable, with residents forced to keep their windows always closed to keep the stench at bay.

The residents say dangerous materials and hospital waste are dumped illegally in the current tip, posing serious health risks.

The European Court of Justice earlier this year criticised Italy, saying it had no adequate system for waste disposal in the Naples region and warning that the problem was a risk to human health and the environment.

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