Department for Education figures reveal that so far 3,211 primary schools have earmarked £7.7m to buy new phonics products and training.
The DfE has also named local authorities that have opted to spend the highest and lowest outlays in these areas.
Schools minister Nick Gibb said he was concerned that there were some local authorities that are yet to take up the offer, which is aimed at improving the way systematic synthetic phonics is used to teach children to read.
Currently 20 local authorities have no schools signed up to the scheme.
The phonics resources include teaching books, software and games. The department also confirmed that there are 987 schools that have booked phonics training for their staff, spending £1.3m to improve their teaching of phonics, the method which ministers advocate as the best method to teach children to read.
The scheme went ‘live' in September last year with the publication of the phonics catalogue of approved products and services. All materials that schools can buy must meet the DfE's criteria.
Under the scheme, any state-funded school with Key Stage 1 pupils – including academies and free schools – can claim up to £3,000 to buy products and training until March 2013.
The DfE singled out Thurrock, Rochdale, Walsall, Lincolnshire, Windsor and Maidenhead, Plymouth, and Sutton, as areas where more than one in three schools has signed up for phonics products. In Thurrock, for example, just under half of primary schools (46 per cent) have claimed the phonics funding.
In others, a high number of schools have booked phonics training.
Derby and Coventry, two local authorities that have reading rates well below the national average for 11-year-olds, also have a high number of schools taking part in the scheme.
The national average is 84 per cent of 11-year-olds reaching the expected level or above in reading.
Areas with with a higher than average proportion of 11-year-olds failing to reach the expected level of reading at Key Stage 2, and with only a few schools signing up for phonics resources, are Central Bedfordshire, Bedford, Hull, Medway, Portsmouth, Luton and Sheffield. In Medway, just four schools (six per cent) have taken up the funding offer.
Schools minister Nick Gibb said, 'This is a chance for schools to gain extra funding to improve reading standards, so I am naturally concerned at the number of areas where few schools have not yet taken the opportunity to do so.
'The money is available until March next year so there is still time to claim it. But every week that goes by is another week that children are missing out on the best possible teaching of reading.
'This is an open invitation to all schools to improve the way they teach systematic synthetic phonics – the tried and tested method of improving the reading of all our children, especially the weakest.'
The Government committed itself to systematic synthetic phonics as the best way to teach children to read in the schools white paper, The Importance of Teaching, published in 2010, and to providing funding for resources and training in all primary schools.
The DfE's focus on phonics as the best method for teaching young children to read has been criticised by many early years experts, academics and practitioners.
Last year a petition and campaign was launched calling on the Government to abandon plans to introduce a phonics-based reading test for all six-year-olds.
TACTYC, the association for the professional development of early years educators, argues that introducing phonics teaching in nursery and reception and the phonics test in Year 1 is highly inappropriate and is not supported by research or evidence from teachers.
But ministers say that international research proves that it is the most effective way for teaching young children to read, particularly between the ages of five and seven.
The latest Government statistics show that more than 80,000 seven-year-olds can read no better than a five-year-old.
Two-thirds of children who took the pilot Phonics Screening Check for six-year-olds last summer failed the test.
