a SENCO is a Special Educational Needs Co-ordinator, it's a member of staff working at the school who has a specific role working with children who have special educational needs.
They may have offered one of the following options, the school has two stages of support - 1. School Action & 2. School Action Plus. The third stage is a Statutory Assessment of Special Educational Needs which may lead to the child being Statemented which means he would be allocated additional support which the school would be legally obliged to put in place.
What the teacher may have been referring to is initiating a Statutory Assessment of his Special Educational Needs - if the school is telling you they have to wait until he turns 6, it's either school or Local Authority policy to wait or just pure laziness on their part.
Parents can also initiate a Statutory Assessment by calling their Local Authority & speaking to their Special Educational Needs section. They can also advise you on what help the SENCO should be providing your child with at the moment.
If you suspect your child is dyslexic, the school or yourselves can ask the Educational Psychology Department to assess him. The Educational Psychology Department can be contacted through your local Authority. Your Local Authority may also have a specialist dyslexia team you can speak to.
For independent advice & support on Special Educational Needs, contact your local parent partnership service & they'll be more then happy to talk you through anything I've mentioned here.
http://www.parentpartnership.org.uk/