some info..
The English test is applicable from 29-Nov-10.
If you're already in the UK, then it's only necessary before applying for FLR(M).
However it looks like if your applying to settle in the UK as a partner comes under 287 or 295G, and uses the form SET(M). The English test is not applicable to applications under 287 nor 295G because neither 287 nor 295G are referenced in the Statement of Changes CM 7944. so looks like there is no change yet if your applying for ILR.
Will an applicant who already has leave to remain in the United Kingdom and who fails the English language test be able to stay in the UK?
Meeting the English language requirement will be a condition for obtaining leave to remain as a spouse under the Immigration Rules. Applicants who fail to meet this requirement will be refused leave and expected to leave the UK, subject of course to observing our international and humanitarian obligations.
those who pass ESOL Entry 1 (the most basic level) will qualify for the English Language test for settlement as spouses, civil partners etc.
If that is a combined ESOL/Citizenship course, then that will also qualify the individual for ILR and Naturalisation applications.
This new language requirement applies to new applicants applying for leave to enter or remain as the spouse or civil partner, fiancé(e) or proposed civil partner, unmarried partner or same sex partner of a British citizen or person settled in the United Kingdom on or after 29 November 2010.
this means those who need to apply for FLR after arriving in the UK will also have to satisfy the language requirement. So those arriving here on a fiancé(e) or proposed civil partner visa need to get their language test sorted out ASAP or they may have to return home, take the test there and reapply for settlement!
thanks to Vinny & Tobias for the info