Background: Phonological awareness is known to be an excellent predictor of later reading acquisition. It remains unclear, however, whether phoneme manipulation alone best explains this association or whether an additional direct contribution of onset-rime awareness is predictive. This issue is explored here. Method: A longitudinal study is reported predicting national test and teacher-assessed performance of 351 children aged 7 from phonological awareness measures, pupil baseline attainment and background measures at age 5. Results: Explicit phoneme manipulation skills at age 5 correlated most strongly with literacy skills at age 5. Phoneme manipulation at age 5 predicted all four reading measures taken at age 7 after pupil background, baseline data and onset-rime awareness were controlled in regression analyses. Onset-rime manipulation did not predict reading at 7 in parallel analyses. After controlling for initial reading at age 5, phoneme manipulation still predicted reading comprehension, and teacher-assessed reading and writing at age 7. Conclusions: Results support the existence of a route from phoneme manipulation, but not an additional direct route from explicit onset-rime manipulation at 5, to reading at 7. Practically, findings show that professionals can augment baseline and pupil background data with phoneme manipulation screening in the early identification of learning needs.