The government is embroiled in a fresh battle over the next census after caving on a plan to leave out a question on sexuality.

Prime Minister Anthony Albanese used annual LGBTQI awareness day Wear It Purple on Friday to announce a full 360 in Labor’s position – saying the queer community would be tallied in the 2026 census after all.

It followed days of backlash after the government initially pulled the plug on an initial pledge to do so.

Labor frontbenchers had said the government walked away from adding the question to avoid a “divisive” and “nasty” fight – but that was what emerged after the omission was confirmed this week.

LGBTQI people welcomed Albanese’s announcement but advocates said the entire queer community should be included, as questions emerged on Friday about trans and gender-diverse people.

The government shouldn’t “pick and choose” who was counted, Equality Australia CEO Anna Brown said.

“We welcome the inclusion of a sexual orientation question but the national snapshot of our nation must include all of us,” Brown said.

Anna Brown and Reverend Jo Inkpin advocating for the inclusion of trans and gender diverse people in the census as well as people born with innate variations of sex characteristics pic.twitter.com/cdHRX2QgQe

— Equality Australia 🌈 (@EqualityAu) August 30, 2024

Trans Justice Project director Jackie Turner said the community needed the data to determine how many people were included, where they were and “what our health and service needs actually are”.

Albanese said the Australian Bureau of Statistics would run a trial on “one question about sexuality”, and people would have the option not to answer it. He denied the government had been forced to back down.

“This is the first time I’ve been asked about it,” he told ABC radio on Friday after being out of the country for a Pacific forum.

All week, senior Labor figures – including Defence Minister Richard Marles and Workplace Relations Minister Murray Watt – have said it was made in the interests of protecting social harmony by avoiding “divisive” debates.

Ahead of the backdown, Labor backbenchers Josh Burns, Peter Khalil, Alicia Payne and assistant health minister Ged Kearney had broken ranks with their leadership, arguing for the question to be included.

All four MPs face challenges in their seats from the Greens at the upcoming federal election.

On Friday, Burns said he was pleased with the backdown.

“I definitely welcome the Prime Minister’s comments this morning. I think that they go to making sure people are counted, and I think that they go to the work that we’re doing to ensure that we are collecting the best data possible to feed into government services as part of the census,” he told ABC radio.

Albanese said the ABS was preparing to test a draft question that was “sensitive and that gets the information that is required”.

Changing the poll was “modernising, reflecting some of the changed values which are there by asking a question”, he said.

“I think that people would think that was a pretty common sense outcome,” he said.

“In 2024 or 2026, the world has changed … people’s sexuality wasn’t as open or as accepted as it is today.”

The census wasn’t “the be all and end all” of data collection, Albanese said.

“We now have data collection in a range of ways, including on our phones and through Facebook and through the range of vehicles available,” he said.

Before Albanese’s announcement, Liberal MP Bridget Archer said it was frustrating Labor had created controversy where there hadn’t been one.

“I don’t think anybody was thinking about it, talking about it, concerned about it, until the government told them they should be concerned in some way by deciding not to go ahead with it,” she said.

Archer’s view put her at odds with Opposition Leader Peter Dutton, who said a question on sexuality was part of “the woke agenda”. The existing census had “stood us well as a country”, he said on Thursday.

“If you’ve got the woke agenda, which I think is at odds with the vast majority of Australians, then the Prime Minister should argue that case, but I think we’re pretty happy with the settings that we’ve got in place,” Dutton said.

Nationals deputy Perin Davey and party colleagues Ross Cadell and Keith Pitt all said they were unfazed about whether the question was included.

Ex-Liberal senator turned independent Gerard Rennick said while he didn’t care because the question wasn’t relevant “as it’s personal”, he was curious to know the percentages.

ACT Labor Chief Minister Andrew Barr was among those to express disappointment. Barr, who is gay, said “there has rightly been a strong focus on the value of data collection to inform evidence-based policies and service delivery”.

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-with AAP