Flake will be along in a minute to recommend one of the Canon SX120 (or similar) cameras
Personally, for £250 I'd buy the Panasonic DMC-TZ6 or TZ7. The main difference is the TZ7 does HD video where the TZ6 doesn't.
A good group test including these cameras is
here.
Note: the review uses the American names which are the DMC-ZS1 and DMC-ZS3