Australian Prime Minister Scott Morrison says he has no plans to change laws that allow religious schools to reject gay students.
A report from an independent review of religious freedoms has been sitting with the government for five months, but has not been publicly released.
Part of the Ruddock review into religious protections has been leaked - and one recommendation is guaranteeing the existing right of religious schools to discriminate on the basis of sexual orientation, gender identity or relationship status.
Mr Morrison, who's under pressure to release the review, said it was still being considered.
The Coalition set up the review after last year's same-sex marriage debate, in what was seen as a bid to placate opponents who were concerned it would restrict the ability of individuals to practice their religions.
Veteran Liberal MP Philip Ruddock chaired the panel, which delivered its findings to the Federal Government in May.
One of the recommendations is that the legislative provisions allowing religious schools to discriminate on the basis of sexual orientation, gender identity or relationship status should be made consistent around the country.
Commonwealth, state and territory legislation present a variety of provisions regarding discrimination based on sexual orientation, and various exemptions for religious schools.
The measure would only affect students, as schools set up for religious purposes already have the right to take such matters into account when hiring staff or contractors.
Schools would have to publicly outline their policy on the matter, and the measures could only be used in expelling current students if their parents were warned of the school's policy prior to enrolment.
Mr Morrison stressed the review had not yet been considered by Cabinet.
"It's a report to government, not from government," Mr Morrison told reporters on the New South Wales central coast.
Shadow Education Minister Tanya Plibersek said expanding discrimination was a "disturbing proposition".
"It's difficult to comment without seeing the report, but our general proposition is Labour doesn't expand discrimination opportunities," Ms Plibersek said.
"What kind of adult wants to turn away a child, wants to reject a kid because they are gay."
The panel's recommendation does not go so far as to allow schools to discriminate on the basis of race, disability, pregnancy or intersex status, and called on any state legislation allowing that to be repealed.
Other members of the religious freedoms panel include Human Rights Commission president Rosalind Croucher, former Federal Court judge Annabelle Bennett and Australian Jesuit priest and human rights lawyer Frank Brennan.
Special Minister of State Alex Hawke described allowing religious schools to discriminate against students as an "absolutely" acceptable proposal.
"I don't think it's controversial in Australia that people expect religious schools to teach the practice of their faith and their religion," he told Sky News.
"That's the point of a religious school, and in Australia you have choice of schooling - you have the public system, you have the private and independent system, and you have religious and faith-based schools."
- RNZ/ ABC