Religious discrimination bill on life support, Scott Morrison unlikely to see bill passed before election

The Morrison government joined Labor and the Greens in agreeing not to debate the package in the Senate on Thursday, following a marathon overnight sitting in the lower house.

The decision came as Attorney-General Michaelia Cash warned new protections for transgender students at religious schools - which passed the lower house against the government's will - risked increasing the grounds for discrimination against other students.

Senator Cash accused Labor and crossbencher Rebekha Sharkie of rushing the amendment, prompting angry response from both parties.

The Coalition also risked more rebellion if it had put the amendment up for debate on Thursday, with NSW Senator Andrew Bragg confirming to The Canberra Times that he would have crossed the floor.

The religious discrimination bill passed the lower house with Labor's support early on Thursday morning.

But a separate amendment to the Sex Discrimination Act to protect transgender students at religious schools from discrimination did pass, after five Liberal backbenchers joined Labor in backing Ms Sharkie's proposal.

Labor had proposed an identical amendment.

The changes prompted the Australian Christian Lobby and some conservative Coalition members, including Tasmanian Eric Abetz, to push for it to be dumped.

"There is now a lessening of freedom of religion as the bill currently stands," Senator Abetz told The Canberra Times.

"Having solemnly promised to deliver freedom of religion as a quid pro quo for same sex marriage, Labor's amendments deliver even less freedoms than currently exist."

The Senate is scheduled to sit just twice between now and the likely May election, leaving little time to pass the contentious bill through both houses before Australians head to the polls.

Mr Morrison promised to deliver a bill to shield people of faith from discrimination in this term of parliament, meaning a failure to do so would represent a broken promise.

The agreement to delay debate avoided a showdown in the Senate, where Labor was planning to push again for further changes to the bill - including effectively axing the contentious statement of belief clause.

The government, including the Prime Minister's office, held talks with religious groups immediately after the amendments to protect transgender students passed the lower house on Thursday morning.

The government wanted to amend the Sex Discrimination Act to protect gay students from expulsion, but didn't want to immediately extend protections to transgender students.

Senator Cash earlier this week warned that stripping the rights of religious schools to discriminate against transgender students on the basis of their gender identity could "nullify" the ethos of same-sex schools.

In question time on Thursday, Senator Cash said the amendment passed on Thursday carried "very, very serious potential consequences" and risked increasing the grounds for discrimination against current and prospective students.

Senator Cash sent letters to Ms Sharkie and Shadow Attorney-General Mark Dreyfus on Thursday afternoon outlining her concerns, including a warning that the amendment could potentially allow religious schools to discriminate against students on the grounds of their sex or intersex status, or if they were breastfeeding.

Media reports have suggested her position was based on advice from the Australian Solicitor General.

But the letter, which The Canberra Times has seen, doesn't refer to legal advice as the basis for her position, only concerns which had been "raised with me" by unnamed parties.

In a statement, Ms Sharkie said she had asked for the legal advice underpinning Senator Cash's letter.

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The Mayo MP said she had "deep concerns" over unseen legal advice, given her experience with the refugee medical evacuations laws which were passed, against the government's will, then repealed after the last election.

"If the government was genuinely worried over the so-called unintended consequences, it could draft its own amendments in the Senate to address said issues," Mr Sharkie said.

"I am disappointed the government has decided to play politics with an issue that's so important to so many Australians."

Mr Dreyfus said the government was trying to cover up its "humiliating defeat" in the lower house.

"It's long past time Mr Morrison stopped trying to blame everyone else, stopped playing politics with the lives of children, and worked with the parliament to fix his bills," he said.