Set during a garbage strike in the 1970s, the film initially focuses on young Ryan (Thomas McTaggart), a boy of around ten, whom we first see twisting himself up in a curtain. It's established that he has a nagging mother, an absent father and a 12-year-old playmate named James (William Eadie). A standard setup, we think. Then, without warning, Ryan falls into a canal and dies.
It's a risky gambit, killing off the apparent protagonist so soon, but it works, giving James one hell of a neurosis to overcome, since he started the play-fight that led to Ryan's drowning, although no one knows this but him. It's not as if he didn't have enough problems. As is the norm for this kind of story, there are two siblings; dad (scar-faced character actor Tommy Flanagan) is a drunk; both parents smoke and swear constantly; and the neighborhood kids seem to have started down the path to violent thuggery.
James's principal means of escape comes when he spontaneously decides to take a bus to the end of the line. He finds himself in the country, near a new housing development, which, without any apparent workers, becomes an adventure playground. He takes a fictional bath in the polythene-wrapped tub, urinates in an unattached toilet and stares longingly out an empty window frame that overlooks what must be the largest open field in the United Kingdom. These scenes almost recall the final delusion in Terry Gilliam's Brazil, or even the tacked-on ending of the non-director's-cut version of Blade Runner: Here is the fantasy world that stands in stark contrast to the filth-ridden urban wasteland. The place may not even exist at all -- the fact that James's parents never notice his absence hints at that possibility, as do later developments that we won't reveal here.
Back in the harsh realm of reality, James makes do with life by befriending Kenny (yes, he wears an anorak, but so do all the other kids), a simple-minded child with a love of animals and a wide imagination; and Margaret Anne (Leanne Mullen), a 14-year-old who, for want of a better term, is the local slut -- she constantly and voluntarily puts out for the neighborhood boys, who generally do nothing but act abusive in return. James, of course, is the one person who does treat her well, and she reciprocates by initiating him into the ways of love. (It should be noted that both get very naked onscreen, and both are clearly underage; maybe in Europe they're "sophisticated" enough to see this without flinching, but all prudish Yanks are hereby warned.)
Writer-director Ramsay has a deft touch throughout: Her actors all seem natural, and her occasional touches of magic-realism -- such as a scene in which Kenny (John Miller) ties his pet mouse to a helium balloon, which then lands on the surface of the moon, a place overrun by rodents -- help to soften the blows of squalor. She also has a good sense of irony: The Chordettes' hit tune "Lollipop" has never been put to better, or more disturbing, use as in the scene of domestic trauma that it underscores. And the ending is nicely ambiguous, interpretable as tragic, beautiful or both.