I guess DS4 was a selective mute. He would not talk in the classroom at all, though strangely was fine in the playground. He was put into a nurture group to help him - he chatted away happily in it but still wouldn't speak in class. Even if I was in his classroom he wouldn't talk to me.
Although he was never diagnosed officially (I'm not sure the school actually knew what to do with him!) his teachers were all very understanding, though it didn't help that his class unfortunately went through 6 teachers in two years so he'd end up getting used to one and then they'd leave and he'd have another new teacher.
He was never punished for not talking, and he was never made to feel bad. It went on through year 1 & year 2. He finally started mouthing words to one of his teachers, then he would go up to her to answer the register quietly. Year 3 saw a breakthrough, he began very quietly answering the register while sitting with the other children and gradually worked up to him saying it loud enough for the whole class to hear. he'd also read one to one and actually really liked reading with a year 6 child.
Year 3 ended with him saying a couple of lines in assembly in front of the whole school, leaving me in tears and his teacher bursting with pride! (And other staff members thinking it was his twin who had no problems talking!)
He's now in year 4 and on his first parents evening his teacher said he hadn't realised there'd ever been a problem! Although quiet he's happy to talk in front of the class and will answer questions.
I've asked him why he didn't talk but he's never been able to answer.
I've been very pleased with the way the school handled it, it was a new thing for all of us and I think they were very gentle with him and it has paid off.
I think you need to talk to the teacher and the Head if necessary, probably the Senco too. If the Ed Psych has said to leave him be then that is what they should be doing. These things take time and punishing him will probably only make things worse in the long run - he's not going to want to talk to a teacher who punishes him and doesn't understand.