Neighbourhood has become a key spatial scale in the UK government's policies for urban regeneration and social inclusion, resuscitating the long-standing debate over the efficacy of area-based policies. The paper argues that the latter need to be sensitive to the interaction between macro-structural and local, reinforcing processes and that 'people-based' policies need to be complemented by 'people and place' ones. The complexities of `neighbourhood' definition are explored, using the distinction between `neighbourhood' and 'place-based community' to support an argument for seeing neighbourhoods as an appropriate spatial scale for understanding the operation of 'everyday life-worlds'. Drawing on research based on a specific regeneration initiative, the 'Pathways to Integration' priority of the Objective 1 Structural Funds Programme for Merseyside (1994-99), the paper goes on to explore the political and operational issues surrounding the spatial targeting of policy and some of the partnership issues surrounding `neighbourhood' and 'community'. It argues that area-based policies and spatial targeting are inherently political as well as technical exercises that need to be sensitive to the social-spatial construction of neighbourhoods and that the operational definition of policy areas should be part of an evolutionary process of community engagement.
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