'Faith-based initiative' sounds less threatening than 'religious school' and so is less likely to scare people. This phrase is increasingly being used in the US and the UK.
Journalist: So you're saying that you want to let religious organisations educate our children so they can learn that evolution and creationism are equally valid?
Tony Blair: They will receive a balanced education.
Journalist: So it's okay for children to be taught to doubt evolution and consider the earth to have been created within the last 10,000 years by a god? All this at the tax-payer's expense.
Tony Blair: Next question please.