Watch Lead Balloon Season 3 in Australia

The episode opens with Rick at a celebrity charity auction trying to attract bids for the waistcoat of an ex-rock star. To start the bidding, he opens with a bit of £500 but with no takers, he ends up with it. Seeing Michael's father at the auction with a man, he assumes that they are a gay couple and resolves to protect Michael from this revelation. Meanwhile Magda has had to move out of her flat as the gas boiler is faulty and moves into the Spleen household. It is clear that Michael believes his father's companion is solely a business colleague, however, when he relaunches his cafe as a chic restaurant, with less than complete success, it becomes clear that this is not the case; Rick's suspicions had been correct. The waistcoat bought by Rick turns out to be worth considerably more than he paid for it, but he has given it to his daughter, whose boyfriend has cut it up for a textiles project at college.

Magda has begun settling in, to the extent of infiltrating her fridge magnets and watching The Jeremy Kyle Show in the afternoons; meanwhile Rick has signed up for a television programme to trace his ancestry. Ben and Sam have formed a pop duo, "Ben and Sam." who are shown performing a track called "Tragic" on Youtube. Michael is inexplicably missing after the revelations about his father, but Rick and Marty find him working out in his garage, seemingly unconcerned. Rick has discovered his Scottish ancestry for the programme, but since his family name is Shaw, the confused Magda thinks he may be Chinese. It turns out, however, that his family history is not interesting enough for the television programme, and is rejected.

Rick has a bad day after doing poorly on a radio quiz and then finding out his email is broken and has to search for a fax machine. To make matters even worse his daughter and her boyfriend and rehearsing their music loudly which he isn't too keen on. His mindset changes though when he hears they could actually make some money out of it.

Rick decides to change his ways after an accident and will only see the positives in people from now on. He is pushed to the limits by Magda as she looks to offload some of his most treasured items, and Marty is sure it won't last. Elsewhere, Ben and Sam begin to move in a different direction and may have to split up.

Rick is forced to go and see a play which turns out worse than he could've imagined as the writer used to be the same level as Rick. He is happier though, to learn that his daughter is single once again until he realises who her latest love interest is.

Rick and Marty have to make extra room around the house when Mel has to work from home. Rick is annoyed by Marty's liking of Mel's assistant and the constant disruptions, until he realises he might be able to get a job through Mel.

Rick is looking forward to spending a quiet Christmas at home with Mel. It will be a well-earned break from the challenging acting role he is currently immersed in - playing the part of Mr Smee in a panto. Marty is no fan of pantomime, or of Christmas in general, and plans to head off for some winter sun - preferably to a country where carol-singing is punishable by death. Meanwhile, Michael has fallen in love at first sight with a chat room friend named Zoe and is already planning to propose on their first date. Ben and Sam are spending the holidays together, accompanied by Sam's gift to Ben of "homemade" mince pies. As for Magda, plans to return home to spend Christmas with her family are called off in favour of a week of mourning when her country's president dies.