Prime Minister Scott Morrison has challenged the Federal Opposition to back the Government's bill to ban religious schools from discriminating against LGBTI students, or allow Labor members a conscience vote on the issue.

But the ultimatum has been met with accusations from Labor that Mr Morrison is "weaponising" the political debate.

The Coalition and the Labor both have bills before Parliament to remove the ability for religious schools to discriminate against LGBTI students on the basis that their sexuality is incompatible with their teachings.

Labor argues it supports the Government's bill, in principle, but has concerns that the wording of the proposed amendments to the Sex Discrimination Act actually opens up further grounds for discrimination.

The Senate agreed to defer debate on the Opposition's amendment until next year, with the Government's Senate leader Mathias Cormann saying the two parties needed more time to consider the matter. "Labor members of Parliament do not support discrimination against children, we don't need to take the temperature of the party to know that, we have had this discussion again and again," deputy Opposition leader Tanya Plibersek argued.

Ms Plibersek criticised anyone who believed Mr Morrison's call for a conscience vote was a genuine offer.

"Our legal advice ... shows that the proposition that the Prime Minister is putting forward swaps one legal form of discrimination with another legal form of discrimination," she said. Read more via ABC