Prior attainment at GCSE can include SATs. At A Level it will include GCSE performance. It is entirely sensible to include this data as prior attainment is a huge indicator of future attainment...unsurprisingly, but as has been said, it is looked at on wider basis.
School prior attainment is also vital for what has to be a statistical exercise in allocating grades. Schools which historically get high grades would get high grades if exams are sat this summer and will be awarded this year by the methods chosen.
So these grades can't just be awarded by schools suggesting the likely grade if exams had been sat in May. Some would be excessively generous and many would be rather too generous - of course there is an incentive to want to help the students and make the school look good. Therefore, some 'moderating' is needed. It's just the same when exams are sat - grade boundaries are set after the exam and based on perceived difficulty of paper and subject and to maintain similar %s of different grades over time. All of this has to happen this year too.
Taking an exam cannot be replicated when no exam is sat. It cannot be identical, but the methods used allow grades to be issued which are based on sensible techniques and will deliver very similar results to an exam system, which in itself is fraught with difficulties.
Everyone worries their child will be disadvantaged or cheated out of grades they could have achieved, given a sudden last push in revision. When teachers suggest grades and overall grades are awarded, they will be based on waht students would have achieved if they had sat those exams in May and done the revision. Everyone knows that many students make big progress in the last weeks - and that will be factored in. However, it should also be remembered that every year when students take exams, many are disappointed. At A Level, well over 75% of UCAS predictions are too generous and students achieve less well. That will be the case again this year and won't mean they have all been cheated of the grades they would have got in the exam. It happens every year and most who planned for uni go - many take students with grades below their offer and clearing always gets many others to places they are happy with. It will be the same this year too.
Every year, the awarding of grades is a statistical exercise as well as being based on exam performance. It has to be a statistical exercise this year too and looking at student and school prior attainment is very important for standardising, as is the fact schools have to put students in rank order.