Head Unit?
Spend around £150 and you'll get an amazing spec. CAD have an Alpine at £150 that will r0x your s0x.
Front speakers? Tricky one in a mk2, but I'd recommend going the MDF door pods route, and fitting components. You needn't spend the earth, but Infinity Reference are amazingly well priced at the moment.
Then pick yourself up a nice four channel amp. This needn't be amazing quality, but MUST be from a 'brand name' - forget SPLx and that other monkey poop you see around, they don't last and over exagerate their outputs.
If you absolutely must have a sub, then something like the low-end Pioneer or Kenwood subs in a suitable box will do you proud. If you're into rock, a 10" is nice and punchy, but a 12" can give more low end for dance and R n' B (Rubbish and B0ll0x)

Lastly, don't forget a wiring kit, but don't spend a fortune - you should be able to get an acceptable wiring kit for about £35-40 tops.
Cheers,
James