I tried using lighthouse but I can't seem to get the auto notification whenever there is a commit to work.
Can anyone suggest a good, simple bug tracking system that works with SVN? I don't mind paying.
I have used http://trac.edgewall.org/ in the past and can recommend it.
It has a ticketing system and tight integration with svn, in addition a usefull wiki. Everyone on your project will probably understand it instantly.
If you are able to, I can recommend outsourcing management of svn repository and trac. I have used an australian company called http://codesion.com/ in the past (It was called CVSDude before) and I was very happy with their services.