"No one thinks it wrong that Comhaltas concentrates on Irish traditional music, or that other communities should want to preserve their own traditions, indeed this is seen as something to be encouraged. Why then should the English tradition be treated differently?"

I think eventually, as years go by, the remit of Comhaltas will be increasingly questioned.
In the meantime, it is secure largely because Irish music and dance makes a lot of money. If England had it's equivalent of Riverdance, or if English sessions had become a cultural export as globally successful as the Irish session then I think the EFDSS probably would be in a very different position (and probably wouldn't need funding so badly).

EFDSS, as pointed out above, already has many hybrid/collaborative events, already features folk arts (visual arts, drama etc) as a peripheral part of its activity, and already hosts folk music events from other cultures (eg London Bulgarian choir).

I suspect increasing amounts of this is inevitable and actually to be desired. This isn't just about funding, it's about people and culture over time.

That doesn't imply that the EFDSS set themselves up as an authority or a spokesperson for those other musics - it clearly doesn't have the funding or resources or expertise to do that even if it wanted to.

But an EFDSS that focuses on English folk music while also hosting and promoting events and programmes that include "immigrant" folkloric traditions (eg calypso, Central and Eastern European traditions, Latin American music) alongside English trad events strikes me as a positive way forward.

It already does a bit of that anyway and whatever the stated aims are and whether or not it prefers 'of/from England' over 'English' that's how I suspect it'll go.