Australian slang referring to children. Maybe you're more familiar with the terms rugrats, kids or baby demon spawn.
Also known as rhyming slang, this sort of thing is sadly falling out of use in every day life.
For those of you wondering what a billy is, it's just a metal container with wire handle and lid. Useful for making tea over an open fire, like when you go camping.
"G'day Steve, coming down to the pub tonight for the strip show?"
"Nah mate, the missus has gone and I'm watchin' the billy lids."
"Strewth, talk about whipped. Maybe you should get a bloody apron and cook up some scones too?"
"Ahh piss off ya bloody meathead."
That's how you get billy lid, it rhymes with kid. Plus everyone likes a good cuppa.
For the curious, you can get an mp3 of the example from my website. http://www.sifnt.net/e2/billylids.mp3 (240kb)