Australians will be asked to vote in a postal ballot to decide whether to legalise same-sex marriage if the government can’t get separate plebiscite legislation through the senate.
A special meeting of the Liberal Party rejected moves to change the party’s policy for an immediate conscience vote on the floor of parliament.
"The government is committed to keep faith with the promise we made at the last election," Finance Minister Mathias Cormann told reporters.
The Coalition hopes to submit its once-defeated plebiscite legislation to the senate again this week.
"If that were to fail, the government believes that we have a legal and constitutional way forward to give the Australian people a say on whether or not the definition of marriage should be changed through a non-legislated, voluntary postal plebiscite," Senator Cormann said.
"If there are concerns about a voluntary postal plebiscite, then I would encourage those senators who are so concerned to consider supporting the government's bill for a compulsory attendance plebiscite."
Labor, the Greens and crossbench senators who rejected the move last time are expected to oppose it again, which would lead to the postal ballot.
"There will be disappointment held from coast to coast night across Australia," Australian Marriage Equality co-chair Alex Greenwich told reporters shortly after Minister Cormann's press conference.
"The government has yet again decided to delay, drag on and disappoint people."
Marriage equality advocates have already indicated they will challenge the validity of a postal ballot in the High Court.
Months of internal bickering and division over the direction of the same-sex marriage debate has led to public policy splits in the Coalition.
It culminated in the special partyroom meeting in which only seven MPs voted to change the party's plebiscite policy.
The party was debating three options: sticking with its plebiscite policy, having a separate postal plebiscite or a conscience vote in parliament.
Five Liberal backbenchers, Warren Entsch and openly gay members Dean Smith, Trent Zimmerman, Trevor Evans and Tim Wilson, were spruiking a conscience vote in their private member’s bill which would legalise same-sex marriage.
As left the meeting, Mr Entsch said it was good the party aired its differences but it didn't change his resolve.
"We need a vote in the Australian parliament and we need it sooner rather than later," Mr Entsch said.
Other MPs are happy to now adopt the party line.
"My view, number one, would be to vote in Parliament tomorrow on the issue but, in recognising the concerns of my colleagues, I am more than happy to go with a postal vote," Liberal MP Jason Wood said as he left parliament.
Earlier, the rebel backbenchers blasted the plebiscite.
“The plebiscite is a D grade response to a defining A grade social issue,” Senator Smith told reporters at Parliament House earlier on Monday.
“It's time for the party to put the matter to rest once and for all and whatever decision that is, the community will be very, very clear about the attitude of the parliamentary Liberal party indeed, the attitude of the prime minister and the government by this evening about what the attitude is.”
Their bill included exemptions for religious ministers and civil celebrants so they would not face penalties for refusing to marry gay couples.
Had their move succeeded, it would mean the Liberal Party would have broken an election promise for a non-binding plebiscite.
Former Prime Minister Tony Abbott, the architect of the plebiscite, had publicly scolded colleagues for drifting from the party’s election commitments.
He also told radio station 2GB there would be “questions about how authoritative” a postal plebiscite would be.
The Labor caucus agreed it was an ‘acceptable compromise’.
"Labor will continue to fight against these poor alternatives to a free vote in parliament, which is the most direct way to achieve marriage equality in this country," Labor MPs Mark Dreyfus and Terri Butler said in a statement.
The issue was also being framed as a test of Prime Minister Turnbull’s leadership as he personally advocated for a conscience vote in Parliament before becoming leader.
One Victorian Nationals MP, Andrew Broad, had already threatened to quit the Coalition if the Liberals allowed a conscience vote. It would have thrown the government’s one seat majority in the Lower House into doubt.
A Coalition partyroom briefing is scheduled for Tuesday in Canberra as parliament returns from the winter break.
It's expected to canvas a timetable and cost of the postal ballot.
