In the United States, they're used to children killing children. Even in Canada, where I've spent the past week, there have been traumatic cases - a girl murdered by schoolfriends in sedate Victoria, for example. The Bulger story fascinates North Americans, none the less, and its latest chapter has been widely reported here, but they're not sure what to make of it.

In the United States, they're used to children killing children. Even in Canada, where I've spent the past week, there have been traumatic cases - a girl murdered by schoolfriends in sedate Victoria, for example. The Bulger story fascinates North Americans, none the less, and its latest chapter has been widely reported here, but they're not sure what to make of it.

In Britain, in the aftermath of the trial seven years ago, people seemed certain what to think. The tabloids felt confident enough of the popular mood to demonise the boys and, in the case of the Sun, to campaign for them to be left to rot in jail for life. But for anyone who sat through the month-long trial, as I did, dismissing the boys as irredeemably evil wasn't so easy. Observing their behaviour in court, listening to the tapes of interviews with the police, hearing expert witnesses under cross-examination, and learning facts about the boys' backgrounds that couldn't be admitted as evidence, all this raised doubts in our minds as to how far Robert Thompson and Jon Venablescould be held fully accountable for their crime of killing James Bulger, and if they merited a 15-year sentence.

Albert Kirby, who headed the police investigation, believed and still believes that the murder was premeditated and that the boys orchestrated it with adult cunning. I've great respect for Albert Kirby but I think he's wrong. When the pair walked James Bulger more than two miles to the railway line in Walton, they weren't taking him to some remote spot where they could "get away with it" but returning to their own neighbourhood. Their behaviour was panicky and confused. A childish dare had become reality and left them with a crying toddler on their hands. The murder, though horrendous, belonged to the world of disturbed childhood fantasy. In what they did, they acted like 10-year-olds.

But they must have known what they were doing, people say. And, of course, at one level they did know: the fact that they tried to conceal the murder was used as evidence in court that they understood the difference between right and wrong. But Thompson, for all his knowingness, asked the police if James had been taken to hospital "to make him alive again", and Venables used to cry when watching films because he "thought they were real". The boys were streetwise but also naïve. They had August birthdays and were so far behind their peer group, academically, that they were held down a year. Physically, neither was tall. Emotionally, both were immature. They knew what they were doing and yet they didn't; certainly not as an adult would.

The decision last week by the Lord Chief Justice, Lord Woolf, to reinstate the original recommended sentence of eight years is a recognition of that. The Bulger family deplore the decision; in their position anyone would. The tabloids rant and compare the boys to Myra Hindley, Peter Sutcliffe and Fred West. But Lord Woolf rightly accepts that children who kill are entitled to a shorter period of punishment: "the overriding mitigating feature of the offence", he says, "is the age of the two boys when the crime was committed".

There are other reasons for his ruling, including the progress the boys have made in their secure units, the remorse they have shown (in Thompson's case this was conspicuously absent during the trial), and the limited risk of their reoffending. But at the heart of it is an acknowledgement, which the Sun and the former home secretary Michael Howard still feel unable to make, that to spend your whole adolescence in custody for something you did as a child is punishment enough. It is not as if the punishment will end on the day the boys are released. To come out after years inside is hard for any prisoner; for these two, who were only 10 when their confinement began and whose crime has made them infamous, it will be difficult in the extreme, whatever strategies to protect them are put in place.

Lord Woolf's ruling may have been vilified in some quarters, but it is indicative of a changed moral climate in Britain. In 1993, the Major era, the public mood was sour and vengeful. Cases of children killing children were extremely rare (and still are), but the rise in juvenile crime - shoplifting, petty theft, joy-riding and so on - led to calls for stiffer penalties against young offenders. Thompson and Venables were to be made an example of, pour découragerles autres. "We must understand a little less and condemn a little more," said John Major, who followed the trial closely. The political agenda was unmistakable. The Bulger killers came to symbolise a moral panic about the nation's children. Hadn't kids once been more innocent, less brutalised? Childhood itself was in the dock.

Seven years on, people look back and see the case differently - as one that reflects as much on adults as on children. Why did so many passers-by fail to intervene that fateful day, though they claimed to see a toddler being mistreated? Weren't Thompson and Venables the victims of trouble at school and home? Shouldn't they have been offered therapy of some kind in the months between their arrest and the trial? And how can we justify trying children in open court, with the world's press looking on? It wasn't popular to raise such questions in 1993; now it's less inflammatory to point out that we have responsibilities as a society - even towards children who kill.

If things have moved on, it is not because of politicians. Taking an enlightened view of the Bulger case has always been a potential vote-loser and MPs are still unwilling to stick their necks out. Simon Hughes for the Liberal Democrats was a lone voice defending Lord Woolf last week. Jack Straw, the Home Secretary, continues to look spineless. When he referred the case to Lord Woolf after the European Court ruling, rather than reverting to the 10-year sentence recommended by the previous Lord Chief Justice, many were surprised. Perhaps he hoped for an increased sentence, since he likes to be thought tough on juvenile crime. More plausibly, he was simply ducking the issue.

Whether judges are the right people to legislate in sensitive public cases is now being questioned, not least by Tory politicians, one of whom, Gerald Howarth, has spoken of "judges usurping the function of MPs". But part of the reason the Bulger case has dragged on so long is because a politician, Michael Howard, in the view of Strasbourg, usurped the function of the judiciary and in so doing violated the human rights of the accused. Judges can be unworldly but that's better than courting the world's applause. Their only interest should lie in seeing that the scales of justice are balanced. Politicians have other interests, primarily that of staying in office, and this makes them unreliable in matters of law. Mr Howard was well aware that doubling the sentence of Thompson and Venables would go down well with Middle England.

This case has seen so many appeals and counter-appeals, so many new rulings and revisions, there appeared to be no end in sight. Lord Woolf should be praised for bringing a conclusion nearer at last. Punishment and retribution have run their course. It is time for Thompson and Venables to be given the chance to atone.

Blake Morrison's study of the Bulger case, 'As If', is published by Granta.