I had Sunday lunch with my retired parents today and Dad was telling me about an African School where the kids paid fees. It was 25p a week unless the family couldn't afford it, in which case it was free! A lovely story, I thought.
In terms of the free lessons here in the UK, I wonder if there is an alternative for lower income people. I think free lessons would really put a few professional tutors out and I agree with Endorka about people not always valuing things that are not free.
It's difficult in this current climate (my wife & I have had one of many belt tightening chats just prior to me coming online). I think you would be better off offering discount lessons or pay for 3 get 4 type deals. Or the alternative is present lessons to a different audience like linking in with the local Youth Offending Teams or Inclusion Units in schools, rather than presenting lessons in the traditional sense. I'm just thinking outloud here and certainly don't present such a suggestion as a finished thought.