The Labor Party has stopped working with the federal government to protect gay students in religious schools, arguing that the coalition is creeping and that the issue must be resolved.
The major parties had been working together to eliminate the exemptions in the Sexual Discrimination Law that allow faith-based schools to discriminate against LGBTI students.
But negotiations have been broken due to the government's insistence that new provisions be introduced that would allow religious schools to impose rules such as forcing homosexual students to attend religious services.
The government promised to eliminate exemptions related to homosexual students at the end of the year, but has not yet done so.
With less than two weeks off before the long summer vacation, Shadow Attorney General Mark Dreyfus says it's time to solve the problem once and for all.
Mr. Dreyfus is preparing to present the bill of a private member to take the issue to the head.
"Given the government's refusal to proceed with a simple elimination of the relevant exemptions, Labor will seek to do so for them," he said on Tuesday.
"There is support throughout the parliament on this issue, there is no reason why we can not move forward and achieve a resolution in the next two weeks."
Religious schools have overwhelmingly indicated that they do not want or need the power to discriminate against gay students.
It is likely that the private bill of the members of the Labor Party will act as a political wedge, forcing the government to present its own legislation to the parliament in the coming days.
Attorney General Christian Porter said the protections proposed by the coalition to uphold school rules were "modest" and necessary.
"We think it's a very reasonable protection for religious schools and they consider that very important to the way they run their affairs," he told ABC radio.
Mr. Dreyfus does not agree.
"The work does not believe that additional measures are needed to broaden the grounds for indirect discrimination for religious schools, as proposed by the government," he said.
Dreyfus says Labor remains committed to eliminating exemptions for gay staff in religious schools, but argues that the issue is much more complex and requires more consideration.
Problems related to homosexual students and teachers in faith-based schools came to light through Phillip Ruddock's review of religious freedoms in Australia.
Mr. Porter said that the government was in the final stages of deliberating on the revision and would publish it very soon.