Ah, I did STEP1 for that, but if your school is telling you that fair enough. You can only do two STEP papers a year, but that doesn't mean you can't do STEP1 in Y12 then STEP2&3 in Y13 - that's what I'm doing. In fairness AEA is apparently easier for a maths student as it's more like the course, but STEP is so much better!
I agree Flashman, but for me it is far more annoying that the courses are getting watered down. The current Edexcel physics course contains material that predominantly was O-level, and should be taught over one year not two. I know this is part of the greater scheme to make results seem better (I heard this refered to as Spinal Tap grading which i liked!) and encourage people to take more subjects at A-level, but the course is now so weak that universities are now having to reduce the standard of their courses or add on extra catch-up modules.
On the subject of retaking. I haven't retaken any modules yet, but my school has persuaded me (against my will!) to retake on of my further maths modules because, and i quote, "Well that's only a low A, you can do better than that" (note: I'm on the old courses, for which top grade is A).
This is one of the major issue's with having private exam boards. Most of the UK boards are now owned by the same publishing companies which produce the official textbooks. Thus for each school that takes their course, they get the exam fee and the textbook fee's. To maximise their income, they need to perusade as many schools as possible to take the course. The school has a target to achieve the best possible results. Therefore the exam boards make the exams easier, encouraging schools to teach it, netting them a profit.
This financial/targets sideline is having terrible effects on the English education system (I assume UK etc also, but have no evidence to support such a generalisation).