At school DS teacher is worried that he's not 'getting' phonics.
Phonics at school is taught in phases in ability groups, and the teacher won't move DS onto the next phase until he shows that he can do segmenting & blending. At the moment he just reads the words 'whole'. He's been in the same group with the same set of words coming around every month for what seems like years. Of course by now he can read the words by sight / memory so there is no need for him to blend, which makes it worse. He does well in the spelling tests 
Clutching at straws here. Maybe he's doing the segmenting / blending in his head before he says something? Are there some children who just never get their heads around this but still manage to read, spell etc? Can we ever get off the start-line, or are we going to get the same spelling words home when he's 16??? 