Bishop Davies said the reaction to the schools'letter showed it was untenable to express religious freedoms as exemptions to anti-discrimination laws,and he asked federal politicians to urgently replace them with"positive protection".
"The intent was to promote religious freedom for Anglican schools but I realise that it had the unfortunate consequence of affecting many gay students and teachers in our schools,for which I am deeply sorry,"he said in a statement.
"There were fears that gay students were going to be expelled or gay teachers sacked. This really saddens me.
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"This past week has demonstrated it is untenable that religious freedoms be expressed as exceptions in discrimination Acts. Some exemptions,such as those relating to sexuality,we do not use and have no wish to preserve."
The apology from Bishop Davies followsstatements of regret from several principals who signed the original letter,which prompted an outpouring of hurt and anger from alumni late last week.
Tim Wright,headmaster of Shore,said it was"silly for us to have even thought that it made sense to say we should retain those[exemptions] and not use them".