I read on the BBC site that a mix of mock exams, coursework and essays will be used to decide the final A-level or GCSE grades.
Personally I prefer external exams because they tend to be more objective and standardized (hence, theoretically fairer) than internal coursework assessment,and allow grades to be comparable across different schools. However, there are some advanced countries with excellent school systems, e.g. Canada, where final grades are based mostly on internal school assessment only and, nonetheless, students still go to university and do well there. I think Alberta is the only province in Canada that still has external provincial exams for final year (Grade 12) students and they count now for only 30 % of the final grade. British Columbia used to have provincial exams too, but I read they have been discontinued, except perhaps for Grade 12 English, but I am not sure. The Canadian posters may comment further.
In the US, external exams aren't normally part of final High School grades either, although some states may require students to take basic state literacy and numeracy tests as a requirement for graduation. As part of university (in US lingo, "college") entrance requirements, many students take external tests/exams, for example SATs and AP exams, but those are administered by private, nonprofit organizations like ETS or the College Board, rather than school districts or the states, and normally do not count for school grades.
I guess in-school coursework assessment might "do the trick" as you put it in countries where the school system is relatively homogeneous and quality doesn't change too much from school to school. That may be the case in Canada for example (I don't know), but certainly not in the US or the UK, hence the need for external exams/ standardized tests. Having said that, exam-based assessment also has shortcomings, mostly related to "coaching" and different levels of access to it. Perhaps a mix of coursework and external exams with different weights would be the best model. I think that is what is done in Australia, and I would appreciate comments from the Australian posters too.