Political and Economic Planning (act. 1931–1978), a group composed of leading figures from business, government, and academia, conducted inquiries into issues affecting British government and society in the twentieth century. Including the broadsheets published as Planning, it produced over 700 publications, of varying length but all substantial. It addressed important questions of social and economic policy, and also brought key issues to the attention of a wider public. Its publications were frequently discussed in the press. The term 'planning' in its title was misleading, and reflected its origins in the uncertainties of the 1930s but was not a guide to its subsequent activities in which the idea of an overall plan for Britain was absent. Although it was formally non-political, its ethos and direction reflected a belief in the interventionist state. It began at a time when there were few competitors in the field of social inquiry, but by its later years it was one of several social science research institutes, and it is in this context that its eventual merger with the Centre for Studies in Social Policy in 1978 to form the Policy Studies Institute must be understood.

Political and Economic Planning (PEP) was the product of prevailing frustration at the apparent political inertia in the face of the economic depression of the 1930s. Support for ‘planning’ became the key motif of those critical of established political leadership, and in October 1930 work began on a version of a national plan for Gerald Barry's Week-End Review under the direction of Max Nicholson. This was published on 14 February 1931. It was an outline of a scheme for industrial self-government and elimination of unnecessary competition; the word 'drastic' occurred frequently. Meetings were organized in London and at Dartington Hall in Devon to draw up a more fully worked-out plan, and the inaugural meeting of members was held on 29 June 1931 at the Royal Society of Arts.

These early discussions were led by Sir Basil Blackett, a director of the Bank of England; Gerald Barry; Leonard Elmhirst, founder of the Dartington Hall Trust; Noel Frederick Hall (1902–1983) from the department of political economy of University College, London; Julian Huxley, the scientist; the children's clothing retailer Lawrence Neal (1895–1996); Max Nicholson; and the furniture designer John Craven (Jack) Pritchard (1899–1992), who was responsible for the title Political and Economic Planning. The National Labour MP Kenneth Martin Lindsay (1897–1991) was its first secretary.

Fairly quickly PEP became directed towards the production of studies on specific areas of economic and social life rather than the publication of a national plan, and this led to the departure of Blackett, its first chairman. This activity was underpinned by three assumptions: that those in the party political establishment were not up to dealing with the depression; that government intervention and greater concentration of power within economic life would be fruitful; and that publication of the facts of given conditions would be an aid to reform. 'If we could learn to see things straight the rest would follow' was a characteristic formulation (Planning, 23, March 1934, 7). Planning was regarded as 'essentially a method of large-scale co-operation among men who have attained a substantial level of education, of critical judgment, of mature character, as well as of technical competence' (ibid., 35, Oct 1934, 9).

PEP's method of working, whereby key figures formed study groups on particular topics supported by research staff, which required regular meetings in the evenings or at weekends, meant that it became from the outset an essentially metropolitan organization; it was also predominantly male. It began in offices at 10 Gray's Inn Place, but within a year had moved to larger premises at 16 Queen Anne's Gate, where a club was established for social interaction and to provide facilities for research staff, which was to last until 1956.

To be successful PEP had to show that it could interest talented and prominent people across business, government, and academia. Key individuals in the early stages were the civil servant Harold Emmerson; the electrical engineer (Thomas) Graeme Nelson Haldane (1897–1981) of the Central Electricity Generating Board; the diplomat Geoffrey Granville Whiskard (1886–1957); the director of the London School of Economics in the 1930s, A. M. Carr-Saunders; Henry Bunbury (1876–1968) of the Post Office; the League of Nations director, and later Gladstone professor of political theory at Oxford, Arthur Salter; the industrial consultant Oliver Wentworth Roskill (1906–1994); and Ronald Conway Davison (1884–1958), an expert on unemployment and other social questions. Two individuals provided sponsorship and support over a long period. Elmhirst, who ran the Dartington Hall Trust in Devon and had a special interest in rural life, was a founder member, sat on the executive committee, and was chairman and vice-president at various times in an association lasting from 1931 until his death in 1974. He hosted weekend meetings at Dartington which became part of the annual calendar. Israel Sieff—'I knew it was my money they wanted in the first place' (Memoirs, 167)—managing director of Marks and Spencer, was chairman in the 1930s, and president until his death in 1972. Sieff provided more than just money. He gave direction to PEP when in its first year the leadership of Blackett threatened to derail the fledgling organization, and he also chaired the industries group that produced some of the early reports.

Throughout its period of independent existence PEP was always able to attract prominent and able people to sit on the executive committee and fill the advisory groups that directed many of the studies. Alec Cairncross, an academic and government economist, was an active member of the executive committee in the later 1940s; Denis Barnes, a leading civil servant from the Ministry of Labour, chaired an advisory group on women and their careers; Mark Bonham-Carter chaired the group on racial discrimination in the 1960s; Frank Figgures, Treasury civil servant, worked on European organization in the 1950s; and Geoffrey Heyworth of Unilever was a member of the group looking at trade unions in the early 1960s. Asa Briggs (b. 1921), the historian, and Eric Roll, economist and banker, were members in the 1970s of the executive committee, in which a leading role was also taken by Monty Finniston of British Steel.

Those members of PEP on advisory groups or the executive council were also heavily committed in public life, and a good deal of the research was carried out by specialist staff, some appointed for relatively short periods of time on particular projects. François Lafitte (1913–2002), subsequently professor of social policy at Birmingham University, was a key figure in the 1940s. With the expansion of social science research after 1945 there was a steady stream of specialists to be drawn upon, such as the sociologist Ruth Glass, who had a short spell with PEP in 1947–8. A number of London School of Economics sociologists who also worked for PEP founded the British Journal of Sociology in 1950.

It is clear from this that conditions in British public life were very supportive of the PEP project to persuade by research. Connections were easily made between leading figures in business, government, and academic life. Businessmen in large-scale corporations, civil servants, and academics moved easily within an integrated and metropolitan based ‘policy community’. The view that policy-making might be influenced through research and reports circulated among intelligent opinion in the hinterland of government—as a kind of rational and deliberate process—was an assumption that characterized PEP's work from the outset, and was widely shared.

This talent was used to good effect: PEP published highly regarded studies of the health and social services in the 1930s, made submissions to the Beveridge committee during the Second World War, and offered distinctive contributions to a growing body of research on employment relations and racial discrimination in the 1960s and 1970s. PEP had evolved from its constellation of working groups in the 1930s into a research institute by the 1960s and 1970s, but its distinctive use of advisory committees overseeing the work of research staff remained. By this time it had to operate in a more competitive environment created by the explosion of social science research. PEP believed it had to carry on doing the same job as before but on a bigger scale. Merger with the Centre for Studies in Social Policy in 1978 to form the Policy Studies Institute resulted in a staff of forty-five rather than PEP's twenty-five.

The intellectual environment had also changed. PEP had always believed in the application of research to policy problems to improve what the state might deliver for a society that was becoming increasingly complex. PEP had acknowledged but sidestepped the views of F. A. Hayek's Road to Serfdom, published in 1944, which argued that societies of growing complexity needed less planning, not more. The claims of the market were a powerful challenge to those of the state, and the value, and disinterestedness, of social science research were also under scrutiny by the 1970s. Avowedly non-political, PEP had taken as its core assumptions both the practical influence of empirical research and social policy as the outcome of rational government. Both of these were looking less secure by the time of PEP's merger in 1978.