Thank you for your fascinating question. While not directly related to higher education, the focus of our discussion, secondary and high school graduation levels will have some impact in the entry level to university. The idea that the A-level awarding organisations in England and Wales are not delivering accurate assessments of candidates should worry university entrance boards who wish to maintain the standards of their first-year intake.
However, I see a real and serious tension between the scholarly mind and the political one, and so many euphemisms and ill-defined expressions being bandied around. What does, for example, “raising standards” actually mean? Does it mean making exam questions more cognitively difficult? or making cut-off scores for each grade higher? or weighting certain test items in ways to make higher scores more unlikely? or what? Furthermore, if students are improving (because of better learning habits, more access to information and so on), is it ethical to increase the difficulty of exams? Massification of higher education may also increase secondary school motivation to learn, and blocking this motivation by lowering the scores available in A-levels may be unethical. After all, if a student has studied hard to reach the A-level, why should they be penalised for political reasons?
A single state-run exams agency will, I suspect, create many problems in the short term. However as a political move, it may be a simple expediency designed to ‘improve’ the value of the A-level. James Flynn (1987) has shown that IQ scores have increased over time in 14 countries. Flynn questions if IQ tests do indeed measure fluid and crystal intelligence, but the notion that diet and lifestyle as well as test familiarity and other schooling factors have effected IQ scores deserves consideration. Humans are, on average, more educationally cultivated than in 1945, and it is reasonable to argue that A-level standards are not easier but that more people are able to reach those standards. A single exams agency, nevertheless, will be able to reset the base level score by increasing test difficulty across the board. This issue is complex.
Flynn, J. R. (1987). Massive IQ gains in 14 nations: What IQ tests really measure. Psychological Bulletin, 101(2), 171–191. http://doi.org/10.1037/h0090408