Just found a nice little deal at Carphone Warehouse... you can buy a no-frills Motorola C115 for £30, it comes with a Virgin SIM with £5 credit on it, and then when you`ve bought another £30 of credit (Doesn`t have to be for the Virgin SIM that comes with it!), you can claim the first £30 back via chequeback.
So in the end you pay £60, get £30 back, and get a phone, and £35 credit. If you could use a spare phone and use more than £30 of credit every two months, you have nothing to lose!