Government seeks to amend Act of Settlement

The government is looking to amend the 1701 Act of Settlement to remove male-preference primogeniture, i.e. the idea that male heirs to the throne take precedence over female ones. This is a good idea and the timing is right. The succession of Prince Charles and then Prince William is secured and would be unaffected by such a move, but it should be done before Prince William and (presumably) Kate Middleton have any children.

They government also intends on removing the ban on members of the royal family marrying Roman Catholics. Technically, it's not exactly a ban, but any royal who marries a Catholic cannot take the throne, so removes themselves from the line of succession. Again, this isn't a problem now, but it might become one should Prince William's children decide that they wished to marry a Catholic.

This one's a trickier issue than the primogeniture question because there's always the possibility that the Catholic parent of a future heir to the throne may insist on their children being brought up as Catholics, which would cause a potentially catastrophic break in the order or succession as they wouldn't be able to take the throne.

Of course, were the government minded to, they could disestablish the Church of England which would make the faith of the heir to throne irrelevant - this is only really a problem because the monarch is also the head of the CoE. But would the English countenance a Catholic monarch? Probably, yes. But would they accept a Jewish or Muslim one? Very unlikely.

However, on balance, yes, the marriage bar should be lifted. One assumes that the calm heads of seasoned Palace officials would counsel against a future monarch ever entering a relationship with someone whose faith could prompt a constitutional crisis.