The stated aims of the system are easily covertly expanded (and there is ample history to indicate that will happen) to turn the school into a panopticon, building a social graph and personality profile of kids as they grow up. To me this looks like an openly hostile act.
If it allows the school to accurately identify the most promising students it's worth it. How many kids with potential fall through the cracks now?
[1] Fine, almost all, there will be exceptions, but the goals of the education system should include making exceptions as rare as possible. At the very least I'll claim a belief that achieving a low enough rate of exceptions so as to make them negligible in practice.