Faith groups are to get special help from the Governmment because they cannot afford the pound;1 billion they need to pay to bring their secondary schools up to date.
The Roman Catholic and Anglican churches say it will be impossible for them to each raise up to pound;500 million to meet their obligations under the Government's Building schools for the future programme.
Ministers have pledged that every secondary in England will be rebuilt by 2015 under the programme, but, under the rules for voluntary-aided schools such as church schools, the groups running them need to provide 10 per cent of the renovation bill.
One in five primaries and one in six secondaries in England are voluntary-aided and the package being drawn up by ministers to help them will also benefit schools run by Muslims and other faiths.
Earlier this month, ministers ruled that faith groups would not be able to use the Private Finance Initiative to rebuild and renovate their schools after objections from the Treasury.
Now church representatives are asking the Government for special help with paying their share of the refurbishment bill.
The Department for Education and Skills working group, which met for the first time last week, includes the two churches and other faith organisations such as the Association of Muslim Schools.
Stephen Twigg, education junior minister, told MPs the purpose of the group would be to "consider the question of the 10 per cent requirement".
But the British Humanist Association has written to Education Secretary Charles Clarke urging him to give no more concessions to faith schools.
Marilyn Mason, its education officer, said: "If the churches cannot afford their tiny contribution to the overall costs of their schools, they should accept controlled status or give them up altogether.
"They should certainly surrender the privilege of using publicly funded institutions in order to perpetuate their creeds."
Martin Bradshaw, from the Catholic Education Service's legal team, said the aim of the faith groups was not to contribute less than 10 per cent, but explore ways the DfES could help them raise it. "We want to contribute as much of the 10 per cent as we can," he said.
"The difficulty with fundraising is going to parents and asking them to put their hands in their pockets for a building that won't open until after their child has left - it's not exactly a good marketing ploy.
"The DfES understands the situation we are in."
Ideas being explored include letting faith organisations take a greater share of the money raised when their schools are sold, cash usually clawed back by the DfES.
David Whittingham, national schools development officer for the Church of England, said it was too early to discuss the possible solutions.
"The meeting was very positive, but it was exploratory," he said. "It was clear officials understood the extent to which the faith community was eager to be as supportive as possible of Building Schools for the Future."
The working group is due to meet again in September. The TES revealed earlier this year that the DfES had called in consultants KPMG in to examine the Building Schools for the Future project because of concerns that it would be unaffordable.