The ACT government will launch a compulsory acquisition process to take control and ownership of Calvary Public Hospital Bruce in the coming weeks.
It will be the biggest acquisition in the history of self-government and the government said it is being done so work can begin on a new $1 billion hospital for Canberra's booming north.
Canberra Health Services will run the hospital from July 3.
The move has been slammed by the Canberra Liberals.
"This forced acquisition of Calvary is wrong. Ethically, it's wrong, Morally it's wrong. It's wrong legally and it's wrong procedurally," acting Opposition Leader Jeremy Hanson said.
"They're trying to ram this through following secret backroom deals that no one knew about. It's outrageous.
"We are absolutely appalled by this. We will not be supporting it. We will not be supporting any legislation that the government tries to ram through."
The government has said the acquisition will be done under "just terms" and compensation will be provided. The government will not provide an estimate but said it would be acquired at market value.
The government had been in discussions with Little Company of Mary, the Catholic organisation that runs Calvary, over its role in the future northside hospital. However, the government said it was forced to take the drastic step of acquisition after negotiations broke down.
The government did not specify a reason but said negotiations were "not successful in delivering an outcome consistent with evolving needs of the ACT community".
Calvary national chief executive Martin Bowles has contended that negotiations broke down. He said Calvary did not want to enter into a new agreement with the ACT government which would shorten its length from 76 years to 25 years.
Mr Bowles said he told the ACT government of this in a letter in November but did not receive a response until Monday, when the government said it would compulsorily acquire the hospital.
Mr Bowles said the organisation had agreed with Calvary on other points.
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The ACT has tried to buy Calvary before. Here's what's different
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ACT Health Minister Rachel Stephen-Smith will introduce legislation in the Legislative Assembly on Thursday to allow the government to acquire the land. Calvary currently has the crown lease for the site.
The laws are expected to pass the Assembly next month.
"The decision about the northside hospital hasn't been easy and it's not one that we've taken quickly or lightly. We know that it will be somewhat disruptive for a short period but building a billion dollar hospital for Canberra is a big investment and we need to get it right," she said.
"We need to own the hospital and be confident that it will be part of a genuinely integrated public hospital network."
The government has said staff working at Calvary will retain their jobs. A transition team has been developed to work with staff at Calvary.
"Our clear aim is that staff will be able to keep doing the same job with the same team in a public hospital that respects the care [workers] provide everyday to patients and to each other," Ms Stephen-Smith said.
In an email to staff sent on Wednesday morning, Calvary management said they were surprised and disappointed with the ACT government's "unexpected and unilateral decision".
Ms Stephen-Smith said the government had not yet considered what the new name of the hospital would be but Mr Bowles said one the hospital is acquired the name Calvary would have to be removed.
The Health Minister said the acquisition was not due to a poor relationship with Calvary.
"I think it is no secret that Calvary and the ACT government have at times had a strained relationship but I want to emphasise that this decision is not about that, in fact over recent years that relationship has probably been stronger than ever," she said.
"Despite these good personal relationships, the efforts of individuals involved and Calvary's ongoing commitment to high quality care. Fragmentation and barriers to genuinely integrated and networked hospital services remain. This tells me and the government that these issues are structural for Canberrans."
But Mr Bowles said Calvary was "extremely disappointed" in the decision and said it was "unexpected and unilateral".
"Our priority is the wellbeing of our 1800 employees at Calvary Public Hospital Bruce, who have not been consulted at all about the potential ramifications of this decision," he said.
"Unsurprisingly, this announcement is distressing for them and we will support them through the next steps and aid their understanding of the options available to them."
The July 3 date of the acquisition is flexible in the legislation, Ms Stephen-Smith said the government would extend the date in a circumstance where they would need to ensure systems are properly integrated.
"For example, if an ICT system needs a little bit more time to transition over, and we need an extra week, to just make sure that everything can be done and delivered smoothly and effectively, that we have the flexibility to do that within the legislation," she said.
The government has said it needed to acquire the site now so it can undertake feasibility studies into the hospital. There will be funding allocated to the hospital in next month's ACT budget.
The government's preferred location for the hospital has always been on the Calvary campus. Consultants were tasked last year to undertake site investigations for potential sites.
Calvary is still expected to run the private hospital on the Bruce site.
The ACT government has previously been locked in discussions with Calvary to transfer the ownership of the site. These negotiations started in 2008 and an in-principle agreement was reached in 2009 but the Catholic church then objected to the sale of its asset.
The government had proposed to purchase the hospital for $77 million in 2010.
Chief Minister Andrew Barr refused to speculate on what the government would pay to Calvary. He acknowledged the previous attempt had not worked but said the circumstances were different.
"It's a difficult decision, not one that was arrived at in a hurry and nor is this the first time that this issue has come before the territory government. The circumstances in 2023 are different and required the government to pursue the course of action," he said.
When asked if the decision was made due to Calvary being a Catholic-run organisation, Mr Barr simply responded "no".
But Mr Hanson was not convinced.
"This is an anti-religious, anti-faith based decision. I don't think anyone can see this as anything else," he said.
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