In spite of a passionate plea by Tony Blair that democracy should not be allowed to be undermined by the rioters, other leaders conceded that such summits, which have been held annually for three decades, cannot continue in their present form.

About 500 people were injured during the summit, and one protester was shot dead by police.

The only positive note to come out of the G8 summit was a surprise agreement between the Russian president, Vladimir Putin, and George Bush to tie America's national missile defence system to a reduction in their stockpiles of offensive strategic missiles.

Mr Bush's national security adviser, Condoleezza Rice, will travel to Moscow tomorrow to discuss details. She said: "We expect to move quickly."

Mr Putin has previously refused to discuss US plans for its "son of star wars" missile defence system.

In the final hours of the Genoa summit, after two days of running battles, details filtered into the Red Zone, the world leaders' security complex, of a fresh bout of violence in the early hours of yesterday morning.

About 200 police officers in 40 vans blocked off a school and another building being used as a headquarters by the Genoa Social Forum, an umbrella group for the peaceful protesters. According to witnesses, the police waded into sleeping protesters. The walls were yesterday smeared with blood and about 35 people were last night being detained in hospital.

Police named five Britons arrested during the raid: Nicola Anne Doherty, 26, originally from Elgin, Moray; Jonathan Norman Blair, 38, from Newport; Richard Robert Moth, 32, Daniel McQuallan, 35, and Mark William Covell, 33. Mr Covell, an activist and freelance journalist known as Sky, was last night in a serious condition in hospital with head wounds, broken ribs and internal bleeding. His video tapes of riots were seized.

The other four Britons were told they would be charged with public disorder and were held in custody after being treated for minor injuries.

Another Briton arrested earlier was named as John Colin Blair, 19.

The intensity of the beatings made the raid a cause célèbre in Italy. Amnesty International is to investigate. About 95 people were arrested in the raid, in addition to 85 held over the previous two days.

The British minister for Europe, Peter Hain, condemned police over-reaction, putting him at odds with Mr Blair, who expressed unqualified support for the Italian police.

Mr Hain said: "You can't defend what has been done in Genoa, either the balaclava demonstrators out there to basically trash the place and bust a skull if they can, or the over-reaction from the police."

The Italian government justified the raid by accusing the Genoa Social Forum of hosting violent anarchist groups in its headquarters.

Silvio Berlusconi, the Italian prime minister, said he had been notified that the umbrella group, which publicly renounced violence, had secretly connived with rioters. "There was no distinction between the two groups," he said.

He said he learned of the raid, approved by the interior minister, Claudio Scajola, after it happened.

The accusation against the Genoa Social Forum reflected the prime minister's fury that months of dialogue with it over holding peaceful protests had failed to save the G8 summit from going up in smoke.

The Canadian prime minister, Jean Chrétien, who is to host the next meeting of the Group of Eight next June, announced it will be held in Kananaskis, a remote Alberta mountain resort that will be relatively easy to defend, unlike Genoa.

More significantly, Mr Chrétien, who discussed the future shape of summits with other leaders on Saturday night, called for each country to cut down the bulging delegations to 50 each, a total of 400. The US is estimated to have had a delegation of about 800 in Genoa, with the Japanese at about 600. Mr Blair said the British delegation was only 27 and he would be happy to cut that even further.

Smaller summits were supported by the French president, Jacques Chirac, who said: "It is necessary to return to the initial spirit of these summits."

The summit cost $200m (£140m) to stage. As miles of security fencing were being taken down last night and the city began to return to normal, the Italian government announced $45m in aid to Genoa to help with reconstruction after the damage caused by rioters.

In their closing communique, the leaders, representing the US, Russia, France, Italy, Britain, Canada, Japan and Italy, condemned the violence: "We are grateful to the citizens of Genoa for their hospitality, and deplore the violence, loss of life and mindless vandalism that they have had to endure."

They vowed to push ahead with summits: "We will defend the right of peaceful protesters to have their voices heard. But, as democratic leaders, we cannot accept that a violent minority should be allowed to disrupt our discus sions on the critical issues affecting the world. Our work will go on."

Mr Bush, at a press conference later, said: "People are allowed to protest, but for those who claim they're speaking on behalf of the poor, for those who claim that shutting down trade will benefit the poor, they're dead wrong."

Mr Blair said that to abandon summits would be "to stand the whole principle of democracy on its head", handing victory to the rioters over democratic leaders.

He criticised the focus of the media on the riots at the expense of the summit's business: he estimated the balance to be about 10 to one in favour of the violence. "The world's gone mad when that is the case. It is the work that the summits do that is the most important aspect."

The final communique, running to five pages, raised questions about the value of the summit. Supporters claimed that while there were few concrete results, the benefit lay mainly in the opportunity for leaders to hold informal discussions on a range of issues.

But the communique showed that European leaders, who support the Kyoto proposals for tackling climate change, failed to secure any concessions from Mr Bush, who says the US will not be bound by the international agreement on carbon dioxide emissions. A compromise thrashed out at a conference on climate change in Bonn last week and by developing countries was turned down by Mr Bush in Genoa.

An indication of the impact of claims by protesters over the last few years that the G8 is a rich man's club was that the opening three pages of the communique were devoted to developing countries, especially Mr Blair's proposals for Africa, and the fourth to the environment, though all the promises were vague.