The IRACE system is popular with smaller clubs in the UK. It's infra-red so only really works indoors, but it's a good cheap way to get going:
http://www.kamtec.co.uk/IRACE-Lap-Sc...d-complete-set
For timing software to get you going you can look at Laps Free:
http://www.rctiming.com
Then upgrade to RC-Timing when you want something more advanced
http://www.rc-timing.com/