The Vatican is being kept informed about the ACT government's takeover of Calvary Public Hospital Bruce, according to its ambassador to Australia.
"I am following the news regarding Calvary Bruce Hospital (where I have gone for some routine check-ups)," Archbishop Charles Balvo told The Canberra Times.
"One of my responsibilities is to keep the Apostolic See (the Holy Father and the different offices of the Roman Curia) informed about the life of the local Church, both positive and negative.
"My personal practice is to communicate as complete information as possible."
But the Papal Nuncio (as the Vatican's ambassador is called) added that there was not yet any direct involvement from Rome.
"In this case the issue at hand is being dealt with by Calvary Bruce Hospital, which has its own legal status in Canon Law, Catholic Health Australia and the Archdiocese of Canberra and Goulburn."
But the Archbishop said he was watching the situation as it developed. "I know something similar took place some ten or twelve years ago," he said.
"In any event, care for the sick is part of the Catholic Church's core mission since its very beginning."
In 2010, a deal to transfer Calvary from the Catholic organisation which runs it to the ACT government collapsed at the last moment when the Vatican declined to give its approval.
The statement by the Vatican's ambassador to Australia comes as the Archbishop of Canberra and Goulburn prepares to meet representatives of the ACT government on Tuesday.
Archbishop Christopher Prowse has said that he wants to restart negotiations with the government, negotiations 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 last week.
The church was considering all legal possibilities but was not rushing to court action. "Let's rush to common sense," he said, before declining to rule out future legal challenges.
"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."
ACT Health Minister Rachel Stephen-Smith on Friday said she had a productive conversation with the national chief executive of Calvary about the next steps in the negotiation.
But any negotiation between the government and the Little Company of Mary which runs the hospital seems to be about how the takeover happens rather than whether it will happen.
"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," the minister said.
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