A leading Roman Catholic adoption charity is to stop finding parents for children in care because it cannot accept Labour's new laws on homosexual rights.
Catholic Care will end its century-old adoption service that places 20 children a year with families because of the Sexual Orientation Regulations.
The laws, which were rushed through Parliament earlier this year despite opposition from many MPs and religious leaders, mean adoption agencies must accept gay couples as prospective parents.
Catholic Care is one of seven adoption agencies that Cardinal Cormac Murphy-O'Connor, the leader of Catholics in England and Wales, has said may be forced to close because of the laws.
The charity, which is based in Yorkshire and run by the Diocese of Leeds, became the first to pull out of finding homes for children in care after a vote by its trustees, who are led by Arthur Roche, the Bishop of Leeds.
In a statement, the charity said it had reviewed its work in the light of new Government legislation.
It added that a principled decision has been taken to gradually reduce our adoption activity and refocus our energy on less well supported and resourced vulnerable groups.
The charity - one of seven Catholic agencies that between them receive £10million a year from local councils -will in future only provide a support service to those already engaged in the adoption process.
Catholic Cares adoption service employs five workers, one in Sheffield and four in Leeds, some of whom are likely to be made redundant.
But it is children in care who will suffer most from the decision.
The charity finds couples and individuals willing to adopt - found from among both Catholics and non-Catholics - and prepares them to meet legal and local authority criteria for adoption.
They are then matched with children put up for adoption by social workers.
Overwhelming evidence suggests the best way to provide a better future for the 60,000 children who live either in care homes or with temporary foster parents is to give them a permanent family through adoption.
Tony Blair pushed through laws designed to encourage greater use of adoption in 2002.
As part of the reforms, gay couples were legally allowed to adopt for the first time.
But the Sexual Orientation Regulations, introduced near the end of his premiership in February, went further by ruling that adoption agencies who rule out gay couples could be breaking the law.
Cardinal Murphy-O'Connor threatened to shut down Catholic adoption services in January.
His call was echoed last week by another senior Catholic - Patrick O'Donoghue, the Bishop of Lancaster.
Bishop O'Donoghue wrote to Catholic Caring Services, an adoption charity in his diocese, to explain his thinking.
He examined options for coping with the lawful requirement to accept gay couples for adoption from the end of next year and concluded: "I favour rejection, thus withdrawal from adoption and fostering from December 2008 if all else fails."
He said the church should not be seen to endorse adoption by samesex couples because 'what we are saying then is that they will be effective parents'.
Bishop O'Donoghue added that adoption law demands the welfare of the child should come first.
But, he said, "we know that what is best for children is to live with married couples. Dilution of that harms children".
He pointed to research finding that "children who stay with married parents do by far the best, whilst those with same-sex couples often fare badly, and certainly never as well as a child with a married couple".
The Sexual Orientation Regulations have provoked wide protest from Catholics and other Christian groups.
Muslim leaders and the Chief Rabbi have also complained.
The rules mean hoteliers will no longer be able to refuse rooms to gay couples, while other businesses will have to accept custom from homosexuals.
For example, Christian printers will have to produce gay lobby literature if requested, while churches will not be allowed to refuse to rent out conference centres or parish halls to homosexual groups.
Catholic Care started its adoption service in the 19th century, shortly after it opened an orphanage for girls in 1863.
The charity has been working within adoption laws since the practice was legally approved in 1926.
The organisation also runs four childrens homes, eight homes for disabled adults, and looks after 37 mental health patients in supported housing schemes.
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