A lot of universities want to be safe in the knowledge that the students they're allowing to come to their department are "the best of the best". Each university wants to be on top of the league tables, and by having excellent students at the start, it's their best bet, since they are more likely to continue working hard/deal with the amounts of pressure/keep motivated, all of which qualities come with A* students.
It is a shame though, that lots of people aren't given as much praise by teachers or parents etc. for getting an A grade, because a ridiculous amount of effort is needed to get an A at A-level; they do NOT come easy. But the A* grade introduced allows universities to filter out the very best of students, which of course they want.