The government has denied caving in to pressure after scrapping proposals to make new faith schools in England take children from other religions.
Under the plans, they would have had to reserve up to 25% of places for pupils from outside their faith.
But Education Secretary Alan Johnson said he had now reached a "voluntary agreement" with churches on quotas making legislation unnecessary.
Tory Lord Baker branded it the "fastest U-turn in British political history".
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Leaders of the Catholic Church and the Church of England welcomed the government's decision to drop its proposals.
Vincent Nichols, the Catholic Archbishop of Birmingham, said Mr Johnson understood it was "quite unacceptable to force into a new Catholic school 25% of people who were not particularly sympathetic to that faith".
The bishop, who chairs the Catholic Education Service in England and Wales, said future schools could now be planned "fully for the Catholic need" and further places could be added "according to local need".
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Previous Pro Ecclesia posts on this subject:
English Archbishop Protests Plan to Set Admissions Quotas for Faith-Based Schools
Why Vouchers Are a Bad Deal for Catholic Schools
Church "Robustly Opposes" Quotas for Non-Catholics in Catholic Schools (Catholic Church in England & Wales)
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