FIAT DEALERS GARAGES

Government troops also bombed and shelled other towns across the country, a day after Russian diplomats rode again to Assad's rescue, blocking language at a meeting of world powers that would have called on the president to leave power.

Sixteen months into an uprising against Assad in which more than 10,000 people have been killed, intensive fighting and shelling has now reached the outskirts of Damascus. New tension has also built up on the frontier with Turkey in recent days after Syrian forces shot down a Turkish jet.

Residents of the Zamalka district on the capital's outskirts were struggling on Sunday to bury dozens of people killed the day before in a mortar attack on an anti-Assad march, opposition activist Susan Ahmad said by phone from the Damascus suburbs.

More than 40 people were killed in the attack on Saturday when security forces fired a mortar bomb into a funeral procession in Zamalka for a man who had been killed in shelling, activists said.

"It is really bad today across Damascus," said Ahmad. "Zamalka was like a massacre, but we couldn't bury all of the martyrs as it is dangerous to be out on the streets and we can't treat the wounded. There is no medicine."

Government troops were raiding Zamalka and Douma, a town of half a million people on the outskirts of Damascus that now stands almost empty after siege and shelling as the army tried to root out rebels, she said.

"Douma is completely destroyed," said Ahmad. "If you go to Douma you can smell the bodies. It's really like a ghost city."

On Saturday, Free Syrian Army fighters fled the town and residents said they feared a massacre at the hands of troops entering it.

Turkey said on Sunday it had scrambled F-16 fighters near the frontier the previous day in response to three separate incidents after Syrian helicopters approached the border.

Turkey, a NATO member that has turned against Assad and allowed its territory to become a rear base for rebels, has mobilised since Syrian forces shot down one of its jets 10 days ago. It sent forces towards the border this week and said it would treat Syrian troops approaching the frontier as hostile.

Top level diplomacy has so far been futile, and a much-anticipated meeting in Geneva on Saturday showed that Western and Arab states had yet to persuade Russia and China to drop support for Assad.

The two countries have repeatedly used veto power at the U.N. Security Council to block calls for Assad to leave power.

The meeting, convened by peace envoy Kofi Annan, agreed that Syria should seek a transitional unity government, but Moscow and Beijing successfully blocked language that would have suggested the new arrangement should exclude Assad.

Western officials say the text agreed at the talks - billed as a last-ditch effort to halt the worsening violence - still implies indirectly that Assad should stand down, but Moscow says it does no such thing.

HOMS SHELLED

The Syrian Observatory for Human Rights, an anti-Assad violence monitoring group in Britain, said more than 150 people had been killed on Saturday and Sunday. It said there was shelling in southern Deraa province and the central city of Homs, long the focus of previous crackdowns.

"We can hear bombing in different areas of Homs city today," said Waleed Fares, an opposition activists who lives in the central Khalidiya district of Homs. The Syrian authorities severely restrict the media, making it extremely difficult to verify such reports.

"There are three-storey building that have fallen down as the Syrian army is using large mortars," he said, adding that seven people had been killed on Sunday and 14 more wounded.

Efforts by International Committee of the Red Cross (ICRC) to evacuate civilians and wounded from Homs have failed twice since the humanitarian group said it had obtained assurances on June 20 from both authorities and rebel forces that their convoys would be allowed access.

Violence prevented safe passage on both attempts, the Red Cross said.

Activist Fares says civilians are trapped in the heart of the city as the army has surrounded central districts and positioned snipers on roofs to shoot people in the street.

"There is no safe place for civilians to go," he said via Skype.

Russian Foreign Minister Sergei Lavrov said on Saturday the Geneva agreement did not imply at all that Assad should step down, as there were no preconditions excluding any group from the proposed national unity government.

Nevertheless, French Foreign Minister Laurent Fabius said the creation of a unity government would imply an end to Assad's rule, because the opposition would not join unless he goes.

"The opposition will never agree to him, so it signals implicitly that Assad must go and that he is finished," Fabius told television station TF1 on Sunday.

Peace envoy Annan, a former U.N. secretary-general, said after the Geneva talks the transitional government should include members of Assad's administration and the Syrian opposition and that it should arrange free elections.

"Time is running out. The conflict must be resolved through peaceful dialogue and negotiations," Annan told reporters.

Annan's plan is the only international peace effort on the table, but has been essentially ignored by Assad's government, with a ceasefire that failed to hold and a small team of unarmed U.N. monitors announcing they could not do their job.

(Additional reporting by Khaled Yacoub Oweis in Reyhanli, Turkey, John Irish in Paris and Stephanie Nebehay and Tom Miles in Geneva; Writing by Oliver Holmes; Editing by Peter Graff)

Britain has had a long and painful history of infighting and changes of heart over how closely to integrate with the EU ever since it joined its precursor four decades ago.

It has often proven divisive both within and among Britain's main political parties as well as the public.

Fears over closer fiscal union in the single currency bloc in response to the euro zone debt crisis has heightened concerns among backbenchers, especially among the eurosceptics on the right of the Conservative Party and the electorate.

Polls suggest that if given a chance, voters would opt out of the EU.

Cameron, writing in the Sunday Telegraph, said he believed the "vast majority of the British people", like him, wanted to make changes to Britain's current relationship.

He wrote that for those outside the euro zone, "far from there being too little Europe, there is too much of it" in terms of bureaucracy. The question was how to get the relationship right.

"As we get closer to the end point, we will need to consider how best to get the full-hearted support of the British people whether it is in a general election or in a referendum," he wrote.

"As I have said, for me the two words 'Europe' and 'referendum' can go together, particularly if we really are proposing a change in how our country is governed, but let us get the people a real choice first."

The Conservative prime minister has resisted pressure from within his own ranks to hold a European referendum up to now, and in the article he did not give a timetable or offer a specific question.

A significant reason for holding back on a referendum is concerns surrounding the economic consequences of an exit from the free-trade bloc, Britain's biggest export market.

Also, the Lib Dems, are pro-Europe, and the two parties have already had their differences over key policies.

"Tactical and strategic patience" would need to be shown, the prime minister said.

ALL EYES ON THE ELECTION

Commentators suggested Cameron might use a referendum as an election fillip, ahead of the next parliamentary vote in 2015, especially after his party's popularity took a knock after a budget in March.

The main opposition Labour Party has been debating about whether to hold a referendum around the time of the election.

An added pressure on Cameron has been the anti-EU party UKIP, the UK Independence Party, which has grown in influence, doing well in local elections in May on a ticket of total withdrawal from the EU.

In the article, Cameron wrote: "As a trading nation Britain needs unfettered access to European markets and a say in how the rules of that market are written.

"The single market is at the heart of the case for staying in the EU.

"I don't agree with those who say we should leave and therefore want the earliest possible in/out referendum. Leaving would not be in our country's best interests."

But he went on to say: "An 'in' vote too would have profound disadvantages. All further attempts at changing Britain's relationship with Europe would be met with cries that the British people had already spoken."

It was the Conservative pro-European Prime Minister Ted Heath who signed up to the European project in 1971, and relations have been tense much of the time since.

In the 1980s, Prime Minister Margaret Thatcher was famously tough in negotiations with European partners.

The Conservatives were fatally divided by endless arguments during John Major's premiership in the 1990s.

After the party returned to power in 2010 after 13 years in the wilderness, Cameron introduced a law that requires a referendum before any further transfer of powers from London to Brussels and refused last year to join a new EU fiscal pact.

(Reporting by Avril Ormsby; editing by Mohammad Zargham)