One of the ideas suggested in a discussion with some friends of mine for free / cheap summer holiday activities was playing Post Office/ postman. You can print off some signs / stamps/ passports etc. from CBeebies Postman Pat website, make a cardboard box Post Office / post box and use old envelopes and scrap paper (finally a use for junk mail!). Then the children can have great fun posting and delivering the post to various rooms around the house or if weather fine you can include bikes in garden to deliver to shed etc.
This then reminded me of a post at Let's Explore about making up 'summer fun bags' one of which was a letter writing kit - Amy suggests gathering up odds and ends of cards, stickers, envelopes, etc. from around the house and included a couple index cards with helpful letter -writing words, and names of friends and family for reference. She also has designed some lovely outdoor stationery - do take a look.
Letter writing is a great way to get children to practice their writing over the summer holidays - children love receiving post so see if you can find a relative or friend that they can write to so they get a letter back!