Will the last person to leave the Church of England please turn out the lights

The Church of England is an institution in decline, with fewer worshippers than ever and dissent in its ranks. Could salvation come in the form of severing its ties with the State?

As the faithful look forward to Easter and the Archbishop of Canterbury prepares to officiate at the wedding of Prince William and Kate Middleton, it may seem inappropriate to be discussing the future of his Church. But this Easter week, I can't help feeling – more than ever – that the Church of England will not survive my children's lifetime and quite possibly not even my own.

It's not the archaism of state occasions that makes me doubt the relevance of the CofE, nor the sight this Lent of a dozen or more clergy crossing the floor to join the Roman Catholics that has made me despair of its future. Nor is it the statistics showing an ever-diminishing number of English attending their services, although these are bad enough. It's not even the spectacle of the Church wrapping itself in knots around the issues of ordaining women and gay bishops.

These are certainly signals of an institution in decline; a community turning in on itself as its relevance diminishes. But the Church has been here before and revived.

If that were all, one might envision – some of its members do – a leadership coming in to revive its fortunes, re-energise its priests and refresh its doctrines, as happened in Victorian times when Darwinian science and atheism threatened to overwhelm it.

No, the real problem of the Church of England is the factor which no-one seems ready to discuss in public – its role as the established church of the country. For humanists and atheists, this is an outrage; a remnant of a political past that should be dispensed with as soon as possible.

To the broader mass of an increasingly secular public, it means very little – some exotic clothes and ritual prayers on state occasions.

What is really worrying for the future of the Church, however, is that its leaders themselves seem to have ceased to believe in it. A sizable number of clergy and several bishops, would be much happier without the burden of establishment. Free of it, they feel the Church has a better chance to reach out to the young and claim its relevance to modern life.

Even the Archbishop of Canterbury and very likely the Archbishop of York, I suspect, are half, if not wholly, of this view. As for Prince Charles, who will become head of the Church when (and if) he succeeds to the throne, he seems thoroughly uncomfortable with the role in his search to be a popular figurehead for all religions and none.

You can see the temptation. In a multi-cultural Britain, why not a head of state that represents all religions? And in a secular nation, why not a church that can battle for souls without the encumbrance of all the conservative connotations of being the established church? I can see Prince Charles inducing a sigh of relief among the bishops – and a cheer from many vicars – if he announced he wanted to do away with the whole thing.

Only that begs the awkward question of what then does the Anglican Church in Britain amount to if it is not the established church? To listen to some in the Church, you would think it a thriving community that is only being held back by its political branding. The truth may well be the opposite. It is only its position as the established church of the country that keeps it going at all.

Born out of political necessity (as Henry VIII saw it), it has survived by reasserting itself constantly as a nationalist bastion against Roman Catholic Europe in its early centuries; as an arm of imperial ambitions in the 19th century and as a spirit of Britishness during the wars of the 20th century. It was what made us different and decent.

That is not to underestimate its social contribution. As the established church it offers the services of priest and place for the rites of passage – birth, baptism, marriage and death – which remain fundamental needs for people, church-going or not. When tragedy hits a community; there is a killing, an accident, a natural disaster, it is still to the church that people go.

Nor is it to deny that in urban parishes there aren't priests who have manage to reinvigorate their congregations through updated services and community action, or that in rural communities the church does not continue to act as a the focal point of village life. It may not be any longer the "establishment at prayer" that it once was, but it remains the "The Archers at prayer" still. The CofE, as with the Anglican communities in Scotland, Wales and Ireland, has long been associated with class and tied to privilege, but it has had a presence throughout society and that has mattered. However, it is no good any longer pretending that this is good enough to enable it to survive into this century.

Rather like the monarchy itself, it has survived less out of the enthusiasm of the public at large, or its affection, but out of a general sense that, given the alternatives, abolition would seem more trouble than it was worth.

So with the Church. The majority of people are quite happy to profess themselves Christian and Anglican. It's easier to accept than asserting a different faith. But they are not so happy to go to church services or take an active part in its activities.

The figures are truly dire. While non-Christian faiths have grown stronger and the evangelical Christian churches flourish, the story in the Church of England has been one of almost continuous decline since the war.

Despite a series of initiatives such as Back to Church Sunday and some improvement in the numbers of young people participating in church activities, attendance figures amongst Anglicans have dropped by some 10 per cent over the last decade. Only 1.1m people, some 2 per cent of the population, attend church on a weekly basis, and only 1.7m, or 3 per cent, once a month. This in spite of the fact that around half the population still profess themselves Anglicans.

The decline in paid clergy has been even more rapid. On the Church's own statistics, the beginning of the new millennium has already seen a fall in over 20 per cent to barely 8,000. On present trends clergy would disappear altogether within half a century. Yet the number of parishes remains set at 13,000 and the total of Anglican churches is little altered at around 16,000. The result is there for all to see: a vicious circle of declining congregations, higher pension and maintenance costs and fewer helpers all sustained on a diminishing revenue base.

In my own rural parish, nine churches have been combined into a single team of one permanent priest and one retired. Those Sundays when there is a Eucharist (not more than twice a month) attract an attendance of a dozen if they are lucky. The situation is not much better in London, where cavernous buildings hold one or two services a week with perhaps 5 or 10 per cent of the pews filled.

Against this dismal backdrop, the Anglican community has decided to rend its own family asunder over the issues of women bishops and gay marriage. Why it's doing so is one of those mysteries to which religious institutions seem particularly prone. It's not just the classic battle between high church and low church which have always been part of Anglican tradition. Indeed some of the evangelical sects are as against women priests as Anglo-Catholic vicars. And they are certainly against same-sex marriages, the issue which has broken up the global communion of Anglican churches.

It's not even as though the average Anglican celebrant feels strongly on the issues. I have come across precious few parishioners who are against women priests or indeed same-sex marriage, although they might blanch at gay vicars living in obvious partnerships. But, talk to the priests now leaving the Anglican Communion to take advantage of the Roman Catholic offer of sanctuary and you'd think that male priesthood was a fundament of Christ's teaching.

Every Synod is now largely devoted to debating and procrastinating on the question (as the one last February did yet again), just as every meeting of the wider international community spends its time discussing whether to break or restore relations with their brethren over gay marriage and priests. The poor old Archbishop of Canterbury's job has become more and more one of a nurse in the emergency ward, desperately trying to stick plaster over a patient with hardly any blood left.

But then The Most Reverend, His Grace the Lord Archbishop of Canterbury, Dr Rowan Williams, is part of the problem. Just as Rome's prelates elected a theologian and bureaucrat rather than a pastor to head the Roman Catholic church, so Tony Blair chose a theologian and academic to head the Church of England.

Why the Prime Minister should be in a position to appoint the spiritual head of the country is one of those peculiarities of Britain's non-constitution. Maggie Thatcher inserted her own prejudices when she chose a "muscular" Christian from Bath and Wells, in preference to the more intellectual Archbishop of York, with his liberal ideas on doctrine and more radical ideas on politics.

Tony Blair, as a would-be Roman Catholic, wanted a man who would pronounce spiritual truths to the nation. He got the voice. You can't stop Rowan Williams pontificating on everything, from banking ethics to media standards. But the one thing the Anglican Church has needed was the one thing that the PM wasn't interested in – and that was a pastor to feed his flock. Williams has the most limited experience as a parish priest. It has shown as he hunkers down in his palace at Lambeth, trusting only to a small circle of intimates.

Something has to give. So long as the Church has been an institution over and above being simply a sect and so long as the Queen continues to exemplify its virtues (she, at least, is a firm believer in her role as head of the Church), it has been possible for it to totter on in gentle decline. But come her death; come the next Synod or a new, more radical Parliament where, one asks, are the forces which are going to defend it?

Does it matter that much if it does go? Not in a religious sense. Christianity has always had sects which have come and gone. Presumably the active churches on the evangelical wing will re-establish themselves as a separate sect or join one of the similar Protestant groups. The High Church clergy will continue, in greater numbers, to move to the Roman Catholic Ordinariate for ex-Anglicans set up in their honour, while those in the middle will muddle on in some kind of rump of disestablished Anglican community attached to the cathedrals.

There is, of course, a problem of what to do about the churches themselves. But that is a problem whether the CofE survives or not. They are part of the country's architectural heritage. Some may be preserved as multi-faith or secular community centres; others as ancient monuments and still others will be returned to Rome from whence they came.

Rather more difficult to answer is the question of whether the established church will be much missed once it has gone? In some ways the response is yes, but not for reasons that are easy to explain in the present terms of the debate – which in itself says something about the decline of religion in this country.

The value of spiritual succour, or just plain caring, at times of grief as of joy; the importance of the rites of passage should not underestimated.

Those who affect to despise them are often those who have never had cause to call on them. For those of strong faith in whatever religion will know where to turn. But for an overwhelming majority of people with weak or no particular faith, the presence of an established church to provide these services to the stricken, dying, marrying or proud with child, the Church of England has been and is there, all the better for being, for the most part, undemonstrative and unchurch-y.

That goes for its theology, as well. In an era of fundamentalism, in Christianity as much as in Hinduism, Judaism or in Islam, the attractions of doubt and openness are not readily applauded. The kind of things that cause the popular press to howl in derision at Anglican sermons – the readiness to accept the miracles and even the Resurrection as a metaphor rather than absolute truth; the willingness to reinterpret views and pronouncements attributed to Christ in the Gospels – is what makes it attractive to those who, in their search of a relationship with their God, try to do so in humility and open-mindedness.

The same problems of the demand for absolutes afflicts almost every other religion. Having an established religion on the side not just of moderation, but tentativeness, gives this strand some extra strength. But it's not the way faith is going at the moment. Nor the Church's leadership.

The Church of England was founded as a political act against the wishes of much of the population and is now dying out of political irrelevance and popular unconcern. History, as we know, moves on, taking no prisoners.