Kids I saw playing around, having a bit of fun (5)
I believe the answer is:
Here is my best explanation:
'kids' is the definition.
(waif is a kind of kid)
'i saw playing around having a bit of fun' is the subsidiary indication.
'playing around' indicates anagramming the letters (I've seen this in other clues).
'having' indicates putting letters inside.
'a bit of' suggests taking the first letters.
The initial letter of 'fun' is 'f'.
'isaw' is an anagram of 'wais'.
'wais' enclosing 'f' is 'waifs'.
(Other definitions for waifs that I've seen before include "Strays" and "Forsaken children".)