jammi - I am not sure you are correct in your analysis there.
Certainly a research report into this issue by the London School of Economics disagrees with you. That found that faith schools often do better because they are allowed to select pupils and not because they are religious.
Here is the link: www.lse.ac.uk/collections/pressAndInformationOffice/newsAndEvents/archives/2006/FaithPrimarySchools. htm.
As I understand it, if a faith school receives 35% funding from a church, then the funding required from the state is lower - 65%. It does not actually have more money than other schools. But this is generally for the buildings maintenance only and teachers and other resources are still 100% funded by the state. Even if a school is 35% funded overall by the church, why is its ability to select not limited to 35% of its places?
I think that the public purse rather depends on this funding from religious groups - small as it may be - as it reduces its budget overall. Therefor the state is reluctant to challenge the church's demand to be able to select pupils. You could argue, if you were being difficult I suppose, that the church is rather holding the taxpayer to ransom.