Apple may be testing an offline/local version of the Dictation feature in iOS, according to9t05Mac.
Currently, you can use Siri for dictation, however it needs an internet connection, which makes it a little less reliable.
9to5Mac reports that Hamza Sood has discovered code in iOS 7 beta, which indicates that Apple may be working on offering an offline version of the Dictation feature.
Based on what Apple is testing, future versions of iOS could allow an iPhone, iPad, or iPod touch to process and convert speech from a user right on the device itself. This would speed up the process considerably, allowing emails, text messages, notes, and web searches take place via voice quicker than ever. The functionality is currently not active in public-facing builds, but we are told that devices internal to Apple have the function up and running.
We are also told that while local dictation is an option in these seeds, the former, cloud-based dictation process is present for certain situations. Perhaps this will be an option in Settings or an option based on internet conditions.
So it is possible that Apple will bring the Enhanced Dictation feature to iOS as well. However, it remains to be seen if the feature will be available when iOS 7 is released later this fall. The offline dictation feature has been available in other mobile platforms like Android.