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I think it is merely a case of the government getting scared that government school systems are getting too much competition. The public schools might also be worried that their prospective pupils are being wittled down to the dregs. That will make them look bad statistically and make it not very much fun to be a teacher at a public school.

These are just random ramblings on my part. I really don’t have any inside info or knowledge of the inner workings of education systems. I don’t have any kids.

You're on the right track.

When I pulled my two boys from public school and put them in Catholic School, I got a call from the public school admin office asking "why?" They're not really interested in my boys, just the money they lose with two fewer students. I said I didn't have an hour to explain, but gave her a few choice reasons:

I didn't like that the school "holiday" pageant included pagan, muslim, jewish and hindu religious songs, but no Christian songs and the Christmas tree was now called a "holiday" tree.
At Thanksgiving, my younger boy's class was told by his teacher that it was a time for the Pilgrims to thank the "native Americans" for their help - no mention of God.
My older boy had a "behaviorly challenged" boy in his class that made it impossible to learn.
The teacher in my older boy's class sat in the back of the room playing on the internet for half the day, every day.
The school library had no Christian books, but lots of books like "Heather Has Two Mommies."

You get the picture.