OP, I'm a primary teacher in UKS2 and we do something similar.
There's no perfect solution when you have 32 children in a class with a huge range of abilities and attainment levels but this approach works pretty well tbh.
The very highest attaining children benefit from working like this because they pick things up very quickly; grasp concepts more easily; and are able to apply them more readily. As a pp said, they do become bored and it's hard to challenge them appropriately if you are busy explaining the basics in 101 different ways when they'd understood it almost before you'd finished teaching it the first time. They get to collaborate with children whose thinking is on the same level as theirs and develop the deeper understanding that they are ready for.
Presumably, there would be a separate group for the working below keystage children who maybe aren't accessing the curriculum at all?
The rest benefit from the collaborative working working in a mixed ability group offers. Eg the ones who get it more easily consolidate their understanding and learning by discussing concepts and explaining them to children who haven't quite got it yet. And the ones who haven't quite got it yet equally benefit from exploring it with a peer.
There's a big focus on metacognition at the moment. Being able to discuss what they are doing facilitates this.
Sometimes the highest attaining children find this hardest because they don't know how they know the answer, they just 'know' it and this can be a focus.
The lower children in the mixed groups get exposed to thinking that is higher than they are currently doing which benefits them, the more able children in the mixed group benefit from explaining.
And, again, as a pp said, there isn't much difference in the others. The very highest and the very lowest attaining need a different approach the rest, teachers can pitch it to the middle fir the mixed ability groups and better meet their needs.