The National Secular Society has urged the Government to rethink plans to allow new faith schools to select all of their pupils on the basis of faith.

The BBC reported that the Government will propose 'relaxing' the admissions cap which currently means new faith schools can select only half of their pupils by faith.

In a letter to Prime Minister Theresa May, the NSS said that the admission cap was a "half-hearted" attempt to "deflect understandable criticism that publicly funded schools should not be religiously segregated and discriminating", but that abolishing the cap would be a "misguided retrograde step".

Just last year the NSS received assurances for Lord Nash, the Parliamentary Under Secretary of State for Schools, that the Government had "no plans to review the 50% limit for faith-based admissions to free schools", describing the cap as "an important way of supporting these schools to be inclusive and to meet the needs of a broad mix of families".

The Government now claims that allowing more discrimination in faith school admissions would make "faith schools of all kinds do more to make sure their pupils integrate with children of other backgrounds."

Only the "most naïve" would believe this, the NSS said, adding that the change would have "the opposite effect."

The Government should instead act to "remove all religious discrimination in admissions to publicly funded schools", the NSS wrote.

NSS campaigns director Stephen Evans commented: "Separating school children on the basis of their parents' faith is no way of building a cohesive society or preparing young people for life in modern Britain.

"In the long-term the only real solution is to have a secular and inclusive education system which isn't organised around the religious beliefs of parents. In the meantime, the Government should resist any regressive demands to allow faith schools to select even more pupils on the basis of their parents' religious beliefs and activities.

"These deeply troubling proposals come after considerable lobbying efforts from the Catholic Education Service and other faith groups. The pernicious influence of religious groups over education policy is making our education system one of the last bastions of religious discrimination. The Government should be looking to end discrimination - not extend it."

The abolition of the admissions cap will particularly benefit Catholic schools. A No 10 source told the BBC that the cap "has prevented new Catholic schools from opening."

The Catholic Education Service welcomed the proposals and said it would enable "thousands of new Catholic school places across the country."

Professor Ted Cantle, an expert in community cohesion and intercultural education, told the NSS he found it "hard to believe that the Government has agreed to drop what is only a minimal commitment to more mixed schools, when we know schools are becoming more segregated. And only last year the Government warned about the dangers of schoolchildren have little or no understanding of others."

Professor Cantle's 2001 report into race riots in Northern England made a number of recommendations for positive policies to tackle a "depth of polarisation" around segregated communities. However this year Professor Cantle has warned that Britain remains and is increasingly divided along ethnic and cultural lines – with "more segregation in schools and more segregation in workplaces" and that faith schools were particularly problematic.

Professor Cantle went on to say: "It is also hard to believe that faith organisations would want- let alone lobby for- this change. This would make them more concerned about their own interests, than that of the wider community.

"If this change is implemented, I hope that the governors for each school will be responsible enough to reject the change out of hand."