Eleven-year-old Johnny Brent is home from school during a scarlet fever outbreak, but he doesn’t bother to stay isolated. He lives in New Brighton on the North West coast, and after watching his father board the ferry to work as a psychologist in Liverpool, he spends the morning exploring the beach and easygoing seaside mischief.
He manages to con a younger boy out of a large horseshoe magnet by trading it for an "invisible watch." The other boy's nanny is not happy with the swap and chases Johnny shouting, > "thief." Johnny runs off and is nearly struck by a car, perceiving this as retribution and deciding he must get rid of the magnet. An older boy uses the magnet to cheat at pinball, and Johnny is implicated, which pushes him deeper into a reckless scramble to dispose of the magnet. He encounters an eccentric iron lung maker who is raising funds for the local hospital in need, and he hands over the magnet in exchange for a promise of help.
The iron lung maker subsequently demonstrates his equipment in the middle of a seaside beauty contest and embellishes the tale of the magnet’s gift to the crowd, painting Johnny as everything from a Fauntleroy to a Dickensian ragamuffin. Persuaded by Johnny’s father to turn the magnet into cash for the iron lung, the maker auctions it again and again, first at £40 and then at subsequent fundraisers, weaving a larger-than-life story that drives demand and keeps the magnet moving from event to event until the hospital’s costs are covered.
On a train back to school, Johnny glimpses the little boy’s nanny and overhears her speaking with a friend about her budgerigar, which has died of a broken heart. Johnny misreads this as a confession about the boy’s death and becomes convinced he is responsible. His mother notices something is off and tries to keep him useful and engaged. She sends him on an errand to the local Maypole Dairy, where a tense moment with a police officer pushes him into the back of a Jacobs cream crackers van. This van carries him to the Liverpool slums, where he clashes with local kids but wins them over by pretending to be a fugitive from the police. They hide him in a building on a disused pier, where he shares soup and dry macaroni bought on the errand.
He then performs a real act of courage by saving a boy who has fallen through the disused pier. That injured boy ends up in the iron lung, the very invention Johnny had helped fund with the magnet. When Johnny visits him, he finds the magnet mounted on the iron lung and is joyfully reunited with the inventor, who is thrilled to have found Johnny again. For his bravery and quick thinking, Johnny receives the Civic Gold Medal. Later, he meets the original boy on the beach and, in a final act of conscience, swaps the medal for his old invisible watch, settling the lingering guilt once and for all.
