It's the way it's been there for ages. And it's not to make people think Cambridge grads have done something to merit the 'promotion' it's tradition where on getting it they're considered senior members of the school (and hence allowed to vote in something). It's certainly not to make people...
From what I understand often your PhD adviser will offer up some topics in the area you're interested it. (You can assume by this stage you've done a bunch of advanced classes, so you'll have somewhat of an idea as to what area you like)