If proposed laws are passed later this year, faith-based aged care facilities will have to allow LGBTI people into their residential communities or risk losing millions of dollars in government.

For the first time in federal law, the draft bill includes protection for sexual orientation and gender and sex diversity. But it also includes the more controversial decision to remove religious exemptions from Commonwealth-funded aged care services.

More than 3,000 submissions were received last month in response to the draft of the Human Rights and Anti-Discrimination Bill 2012.

Anglicare Sydney, the community care organisation of the Sydney Anglican Church, has defended its “fundamental freedoms of religion and association” by calling on the federal government to keep the religious exception in place until further consultation.

The organisation depends on Commonwealth subsidies to cover more than half of its annual operating costs.

Anglicare wrote that the new laws would lead to conflicts in aged care residential communities.

“Our view is that religious organisations should be given the opportunity to outline how they believe such discrimination is justified or otherwise in the light of the fundamental freedoms or religion and association,” the submission said.