Back at work after the factory strike and with a pay rise, Harvey disapproves of Lou's involvement with local black market king 'Connie' Rosenthal. He is proved right when Lou is arrested for having four crates of whiskey in his car boot and refuses to name Rosenthal for fear of reprisals.

Rita, working in Rosenthal's drinking club, meets new gentleman friend Monty who starts to buy Stanley's affections. Harvey does a deal with 'Connie' that gets rid of Monty though it involves Lou getting sent down for three months.

With Lou in a sanatorium, Maggie starts to train in nursing.

Harvey gets a letter from Harriet to say she is engaged to another man, but Rita quickly recovers from her ordeal with the murderer when Monty returns from Liverpool and pays her to host card schools.

Harvey comforts landlady Frieda Gottlieb after her synagogue is fire-bombed in reprisals for the King David hotel in Israel. In gratitude, she gets her brother to bake Stanley a birthday cake.

Denied time off work to attend the Labour party Conference in Brighton with fellow councillor, solicitor Dick Elliott, Harvey quits his job but gets offered work by Dick as well as hearing a German address the delegates.

Maggie moves into a nurses' home when Monty fills the prefab with his black market wares but also gives notice after being bawled out on the wards whilst Stanley learns to box and turns the tables on a bully at his new school.

After a visit from Monty's pregnant girlfriend, Rita dumps him and goes out with the charming, urbane Leo Brandon, who has employed Maggie in his hat shop, only to be told that he is gay!

Maggie is also dated by the well-spoken, well-educated Tom. Harvey starts work with Dick and his father in their law firm, falling foul of officious chief clerk Ryder but persuading the firm to act for the Gottliebs in their efforts to free a young Jewish friend arrested by the British for trying to enter Palestine.

Christmas is coming, and Harvey clears the air with Ryder whilst Rita takes over the running of the salon and Maggie gets back with Tom, to the dismay of her annoying friend Veronica.

The Gottliebs' teen-aged compatriot Yossela moves into the house but he is deeply disturbed by his wartime experiences and behaves erratically, slashing a portrait Frieda is painting of Harvey as he is jealous of their growing relationship. Ultimately, with Tom's help, he is put onto a ship bound for Palestine and, with peace restored, Nan kisses Erich under the mistletoe.

Harvey feels that Stanley is getting out of control and wants him to move in with himself and Frieda for when they are married. However, Frieda's paintings attract the attention of Jewish gallery owner Adrian Horowitz, and she seems set on her own career.

Rita considers a divorce before going on holiday with Leo to the South of France following his mother's death.

Nan meets Geoff, an old flame now a widower, who proposes marriage to her.

The Moons get a scare when Stanley is rushed to hospital with suspected polio,though it proves to be a false alarm.

The path of true love does not run smoothly for Nan when Geoff's objectionable son Albert makes it clear that he opposes their courtship. Harvey, however, is not only appointed as a magistrate, thanks to Dick, but gets to organize a dance to celebrate the marriage of Princess Elizabeth and to which Frieda accompanies him,having broken a date with Adrian Horowitz to do so.

1948 starts badly for Harvey when the local Labour Party, unsympathetic to his recent troubles, accuse him of bringing them bad publicity.

Feeling that Dick has not supported him Harvey offers his recognition from the firm though he reconsiders when Leo, set up by jealous ex-boyfriend Joshua, is charged with importuning and Dick asks him to prepare a defence case. In court Rita gets Leo acquitted by claiming that they are lovers and, in so doing, provides Harvey with grounds for divorce on account of her supposed adultery.