 In the morning, Richard hears a local radio news bulletin about a drugs raid in the vicinity. He, Nick and Matthew think it s related to the "smugglers" they ve been watching. When Matthew spots the very same van seen at Richard s neighbour s house, he spreads the word to the other two, and they panic that they ve infiltrated the school. A model boat race is to be held in the playground with Mr. Hankin and Mr. Mackenzie heading the teams, and one of the boats powered by steam. Neil Timpson becomes an unofficial booky to profit from the venture, thinking that Mr. Mackenzie s steam boat doesn t have a chance. In Mr. Hankin s class, while the teacher is fully absorbed in creating his boat, Matthew takes a peek worriedly into the corridor. He sees one of the "smugglers" with a gun in his hand. They decide they ll call the police at lunchtime. Mrs. Monroe s class is interrupted by Mr. Griffiths s entry, holding a ceiling tile, and asking if anyone recognizes the footprint. There s an unexpected diversion in the 4th form art class, when they are packed off to the Hall. Mrs. Monroe makes a mysterious announcement about their imaginations and asks for volunteers to help out on stage. Thinking that might be the safest place with armed drug dealers on the loose, Matthew, Richard and Nick come forward. To the music of Holst, they become part of a surreal play, as three men and a woman emerge from the floor of the stage, heavily made up as though they are the walking dead. The three lads are blindfolded and have their wrists bound and are led onto stage. They take part in a play that demonstrates against people unfairly imprisoned and have to guess objects placed before them - handcuffs, bars, a handgun ... Unfortunately, Matthew hasn t quite sussed the reality of the situation, and the gun puts terror into him, and he races off. Ted goes to speak to Mrs. McClusky about his legal position with Chrissy. She reassures him that the law probably won t prosecute. Outside as the boat race is prepared, Neil finds lots of bets supporting the steam-driven boat, and then the reason becomes clear. Mr. Mackenzie produces some pebbles for each craft to carry, as part of the rules about an "agreed payroll", so the test becomes more evenly matched. After the steam-powered machine wins, Matthew appears from the corner of the playground, and angrily tells Richard never to pull a stunt like that again, thinking that the entire business with the smugglers was something that Richard knew about. After school, Chrissy goes back to Ted s house with him, for moral support while Ted tells his folks about the pregnancy. In hospital, Brian Shaw s parents have bad news: he needs a bone marrow transplant if he is to survive his leukaemia. Mrs. Monroe brings in Jacko and Locko to see him - he lies weakly and without hair, in his hospital bed.