Canberra's Catholic archbishop wants to return to the negotiating table with the ACT government in an effort to halt a compulsory acquisition of Calvary Public Hospital Bruce.
Archbishop Christopher Prowse said he wanted to restart negotiations with the government that faltered last year.
"I know there's been difficulties, but let's make a fresh start. I want to announce that we're prepared to go backwards and start looking at this matter in a fresh way," Archbishop Prowse said.
The church was considering all legal possibilities but was not rushing to court action, the archbishop said.
"Let's rush to common sense," he said, before declining to rule out future legal challenges.
Archbishop Prowse said the government's decision to take over Calvary hospital was un-Australian, but the relationship could be revived.
"There is angst, fear about what has been happening so far, but I don't think it's reached a poisonous stage where it's impossible to go ahead," he said.
Archbishop Prowse said all agenda items should be on the table, including striking a new agreement for Calvary to operate a rebuilt public hospital at Bruce.
Archbishop Prowse said he wanted to know what the real reasons the government had launched "draconian" action to take over the hospital.
"We're here to assist people from conception to natural death and all the stops in between, to offer first-class hospital care," he said.
"I am not convinced by the arguments that the government are giving us."
ACT Health Minister Rachel Stephen-Smith on Friday said she had a productive conversation yesterday with the national chief executive of Calvary about the next steps in the negotiation.
"That's really a matter between the ACT government and Little Company of Mary, it doesn't have any formal connection to the Archdiocese here in Canberra and Goulburn or the Catholic Church really in Australia," Ms Stephen-Smith said.
"Its direct connection is back to the Vatican. So those conversations will continue with the Little Company of Mary about how we manage this transition and how we do it as collaboratively as possible in the best interest of staff and patients and families here in the ACT, despite our disagreement about the process."
Archbishop Prowse said the hospital was "unashamedly Catholic in its ethos", which was a positive for the community.
"I want to really denounce what is happening, the government, this compulsory acquisition is really pouring fear into the people here," he said, speaking out the front of the hospital on Friday.
"I've just had the privilege of being with them on a pastoral visit for some time. The complete lack of any communication consultation has been really not just disappointing.
"It's starting to put real anger into people's hearts.
"I spoke to quite a few who come from overseas and they said they've come to this fair country to get away from sort of a totalitarian regime, and they've started to find it happening here. And they are very, very concerned about it."
The ACT government last week announced it would launch a compulsory acquisition process to take control and ownership of Calvary Public Hospital Bruce, part of a process that will eventually include a new $1 billion public hospital on the site.
A group of senior doctors at the hospital have called on the government to halt the process, which will be authorised by a truncated Legislative Assembly.
A leader of a new Catholic Church action group, Father Tony Percy, accused the territory government of "religious bigotry", as a campaign was launched.
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