The policy of the British prior to the period of the Revolution had largely been hands off. However, the Tea Party went too far and the British had to respond (one wonders what else they would have done). They had just won the equivalent of world war in 1763. British had fought in almost every of the globe from India to Canada, India, the Philippines and the 13 American colonies. Unfortunately, to borrow an apt analogy, the British had only the military in the tool kit once their tax collection efforts failed. If a hammer is all one has in the toolbox, most solutions will look like striking a nail. The perception was that the crown had defended the colonies against France and now that defense must be paid for. They looked at the thirteen colonies as ungrateful subjects who would not pay their bills (ibid., 14-15). Since hands off did not work, the hands were now on. Unfortunately, these were the hands of red coats and British sailors and marines and the military leaders and their political superiors were obviously making it up as they went along. After the war with Indian chief Pontiac, British policies were obviously a failure. Innovation was now the matter of course. Unfortunately innovation hit the solid brick wall of colonial opposition to taxation and colonial opposition to limiting white expansion...

However, one must realize that America was not the only world area of empire that was a priority. British forces in 1763 had won the equivalent of a world war and now the sun truly did not set on the British Empire. The primary purpose of the empire worldwide must be to pay off the bills of its acquisition. To this end, finance was the fulcrum of British policy of administration and ultimately led to the British exit because they had no definitive policy beyond that. Hands off was not readily replace by hands on. Ultimately, indecision led to the loss of their investment in total.
References

Beer, George Louis. British Colonial Policy, 1754-1765. Cambridge, U.K.: Cambridge University

Press, 2010. (accessed February 9, 2012).

McDougall, Walter. "The Colonial Origins of American Identity." Orbis (2004): 7-19.

White, Richard. The Middle Ground: Indians, Empires, and Republics in the Great Lakes Region.

Cambridge, U.K.: Cambridge University Press,…