I agree that the level of spelling and grammar in England (don't know the rest of the UK well) is quite low.
I come from another country and have English as a second language, but when I studied in England the other international students I knew and I were told our spelling and grammar were better than that of the British students (admittedly this was Staffs uni, not Cambridge, 
).
And I went to bog standard state schools. (although had a great teacher who taught me so much English grammar).
I found it very amusing that even my (very middle class, privately educated) English ex-boyfriend asked me about English grammar.
Anyway, my point isn't that my English grammar and spelling is great (I am sure you'll find mistakes here, and i am totally dependent on the spell checker) but that these things are better taught in other countries.
It's all about priorities though. In my country science teaching is quite poor, it's all about what is seen as important I think.
I actually think that correct use of grammar is more important than spelling, as spelling mistakes can mostly be avoided with spell checkers. English spelling is much harder than in many other European languages, and it is difficult to get it all right when writing by hand. But in work situations you can use a computer, so that's not a big problem (IMO).
But if people don't know the difference between there and their or have and of, a spell checker will not help, and it will really make a bad impression when writing a job application.