Phonics is a method of learning to read. Phonics works by breaking each word up into it’s individual sounds before blending those sounds back together to make the word. Children learn to 'decode' words by breaking it down into sounds rather than having to memorise 1,000s of words individually. Research has shown that phonics, when taught correctly, can be the most effective way of teaching children to learn to read. Sounds are taught from easiest to hardest: starting with single letter sounds and then moving on to two letters making a sound and then three and so on. Learning phonics and learning to read is one of the most important stepping stones in early education as it gives your child the skills they need to move forward in every subject, you simply cannot progress without it.
More information is available in this Letters and Sounds Document