A The National Strategy says children with significant literacy difficulties should be offered targeted support. They sometimes have other learning difficulties and are usually on the school action or school action plus stages of the code of practice.
I can't really recommend one programme - because I don't think there is a single recipe for all kinds of learning needs, ages, or for all schools.
However, there is a useful publication from the national literacy strategy, Targeting support: choosing and implementing interventions for children with significant literacy difficulties (2003)*. It contains a description of 18 programmes (out of 44) that had significant impact in a major study.
The document describes initiatives such as parental involvement and paired reading as well as commercial packages that you can buy. There are also guidelines for reviewing what you already do.
The study on which the document was based, What works for children with literacy difficulties? (Brooks 2002) emphasises, among other points, that phonological skills should be embedded within broader approaches, that raising children's self-esteem has real potential, and that schemes such as paired reading can be very effective. It is certainly worth reading the material and having careful discussions about how your school can most effectively give support - including how teaching assistants are trained to teach literacy and respond to individual needs and how you support and monitor this work. This is probably more significant than purchasing a specific programme.
*You can download it from http:www.standards.dfes.gov.ukprimarypublicationsliteracy63437