Because taking those $X out from the public system weakens the one that it should be government's priority to strengthen.

Catholic schools have the privilege that they can easily expel the behaviourally disruptive, knowing that the public system is there as a fallback that pretty much has to take them in and keep them no matter how much trouble they cause in classrooms. There are obvious advantages to the former for even non-Catholic parents, but if it's made easy, it eventually leads to the hollowing-out of the public system into little more than a dumping ground for the ADHD, autistic, and oppositional-defiant kids.