Anthony Albanese has guaranteed Australia’s annual refugee intake will not be cut next financial year, shutting down plans for the arrivals quota to drop by one-third to Coalition-era levels.

Labor MPs and refugee advocates reacted angrily to news on Thursday morning that the home affairs minister, Tony Burke, was planning to cut intake of 20,000 arrivals to 13,750 in 2027-28.

By late afternoon, the prime minister confirmed the change would not proceed.

News of the plan coincided with efforts by Labor to drive down migration levels amid increasing political pressure from One Nation.

“The refugee intake needs to be renewed in the coming budget as the 20,000 places was available for 4 years,” Albanese said in a statement.

“This intake number remains government policy and will be continued in future years, consistent with Australia’s humanitarian commitments and sits beside our strong border security measures.”

Migration settings are currently the subject of an internal fight within Labor, as the government seeks to bring net overseas migration down to 225,000 next financial year.

Burke had delayed announcing the broader policy earlier this month. Rules for backpackers will be tightened, including working holidaymaker settings for Britons coming to Australia.

Earlier, when asked about the refugee intake changes on Thursday, Albanese hinted some of the reporting was incorrect and said Labor was responding to post-pandemic fluctuations.

“We’re worried about trying to get numbers right,” the prime minister said at a regional summit in Dubbo.

“We’re responding to national needs,” he said.

“There is a current spike in the support for One Nation, quite clearly, but we’ve responded. We started lowering the numbers well before that occurred because we recognise that we want to get that right to assist the Australian economy.”

In 2015, Labor’s national conference committed the party to accepting 27,000 refugees a year by 2025, part of a heated debate over asylum seeker policy and boat turnbacks.

At the latest national conference, held in Adelaide in July, delegates approved language, saying:“Labor will seek, in the short term, to maintain Australia’s government funded humanitarian intake numbers at 20,000 places per year while also continuing to aspire to achieving 27,000 places per year.”

Jana Favero, the Asylum Seeker Resource Centre’s deputy chief executive, said the government was betraying people around the world who were relying on Australia.

“There are already Australian families desperately waiting to bring loved ones to safety from Iran, Sudan, Gaza and conflicts around the world,” she said.

“What makes this even more disturbing is the politics behind it. The government appears increasingly willing to let One Nation dictate the terms of the migration debate, even when that means abandoning commitments made by its own party just weeks ago.”

Paul Power, of the Refugee Council of Australia, said the cut went against pledges made by the government at home and abroad.

“When the Albanese government increased the refugee and humanitarian program to 20,000 places in 2023, there was no hint that this was a short-term increase.

“Until now, Australia has been the only OECD country with a significant refugee resettlement program not to cut places in the past two years. Such a cut would make little difference to Australia’s net overseas migration but be devastating for people seeking a path to safety.”

The Greens’ immigration spokesperson David Shoebridge said punishing vulnerable people was a backward step for the country.

“The difference between One Nation and Labor is that, when One Nation attacks refugees, they don’t then pat themselves on the back for how much they support multiculturalism,” he said.