Because, as Angela Eagle MP (I've met her !) says (in more diplomatic language than I'm going to use) if you allow exceptions on religious grounds to a law forbidding bigotry all that will happen is that every homophobe will suddenly develop a personal relationship with Jesus.
If Tony Blair (who wants to be a catholic when he grows up) were still in the ascendant he might well have given the Cardinal what he wants. It's a sign of how his authority has waned that the Cardinal got knocked back.
And the other thing it demonstrates is how Christian leaders are losing their grip. Do they really want to present the Gospel of Jesus Christ as being primarily about hawt gay sex? Surely not? But to judge by the headlines they provoke, this is about the only thing on their minds these days.