The Sydney Anglican Diocese has backed down on a controversial policy banning smoking ceremonies on any property owned by the church following outrage from Indigenous leaders, school principals and priests who work closely with First Nations communities.

ABC reports of the proposal, due to be debated on Monday night at the annual gathering of the Diocesan synod in Sydney's CBD, were greeted with anger by Indigenous leaders who likened the decision to assimilation.

The reports have also shocked principals who have regularly held smoking ceremonies on school grounds and infuriated local ministers who told ABC News that there had been no consultation and that it would be deeply embarrassing and offensive to Indigenous friends and parishioners.

The Synod will still debate on Monday evening the banning of the uses of church property for meditative yoga, as well as the controversial policy to not allow any use of schools, church halls or commercial premises leased by the church for same sex marriage ceremonies, receptions or "advocacy" of any form of sexuality that is not a man and woman in marriage or single abstinence.

The banning of the ceremonies was based on a policy developed by the Diocese's Religious Freedom Reference Group, chaired by Bishop Michael Stead, and is based on the idea that "church property must not be used for purposes which contravene the doctrines, tenets and beliefs of the diocese".

One of those beliefs is that other gods must not be worshipped — or spiritualities that are not Christian.

On these grounds, "smoking ceremonies where the purpose is to cleanse a place from the residual spirits of those who have died" were not to be allowed on land owned by the Sydney Diocese.

A spokesman for the Diocese said the policy was "based on advice from a senior Aboriginal leader". When pressed as to who that was, he said it had been the former inaugural chairperson of the Sydney Anglican Indigenous Peoples Committee Ray Minniecon, though he added that the advice "was not specific to this policy."

Pastor Ray Minniecon said he was disappointed by the Sydney Anglican Diocese's proposal to ban smoking ceremonies on church property. ( Supplied )

But earlier Rev Minniecon told the ABC the first he had heard of the proposal was when the ABC called him.

An Aboriginal pastor with roots in the Kabikabi and Gurang-Gurang tribes of Queensland — and one of the Sydney church's most senior Indigenous elders — Rev Minniecon said he was "very happy" to hear the smoking ceremony ban had been pulled from the synod papers pending further discussion.

"At first I thought you meant banning cigarette smoking and I thought, 'Oh yeah, that's good'. Then I saw [the policy] and was disappointed," he said.

"I don't think it was well thought through and discussed appropriately with our mob, our people."

The Diocesan spokesman said he could not provide a copy of the advice, as he did not think written advice was "the way of doing business in the Indigenous community."

"We want to respect Aboriginal spirituality but it is different to Aboriginal Christian spirituality," the spokesman told ABC News.

The reversal occurred, he added, because "the advice was given in relation to a specific context and we now feel that wider consultation is warranted before formulating a policy with broad application. Therefore, the section on smoking ceremonies will be withdrawn before it goes to synod."

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Principals puzzled and relieved

The principal of Barker College, Phillip Heath, said he was relieved to hear the proposal had been shelved on Sunday. His independent Anglican school holds several smoking ceremonies every year.

The ban had come "out of the blue", he said, and he had been "shocked, distressed and mystified" by it.

"I was not aware there was anything pagan about them, quite the opposite. It's becoming a common practice in Anglican schools," Mr Heath said of smoking ceremonies.

"The ban would have been an "unloving gesture from us, particularly when a number of us are trying very hard to reach out to Aboriginal folk and learn from their vivid spirituality about the land, creation and who we are.

"God was not asleep before Captain Cook and Arthur Phillip, or before Christian theology, that's absurd. So I for one listen intently to the way of seeing the world that Aboriginal people bring to my consciousness and that sits comfortably in where I sit as a Christian."

Barker College principal Phillip Heath said he was shocked and distressed by the proposal to ban smoking ceremonies. ( Supplied )

In 2016, Mr Heath and the Darkinjung Local Aboriginal Land Council established an Indigenous school at Yarramalong on the Central Coast — the Darkinjung Barker School for Kindergarten to Year 6 Indigenous students.

Mr Heath said he had been delighted with recent results in literacy and numeracy.

Another school that holds smoking ceremonies is Wenona in Sydney's north.

Briony Scott, the principal of the school — which is independent and non-denominational but influential in the Anglican community — was previously principal of the Anglican Roseville College.

"We do them when necessary ... one of our Indigenous boarders was having a very tough time, so her family came and conducted a ceremony around the boarding house. It helped her a great deal, and I loved being surrounded by the smell of burning eucalyptus leaves," Dr Scott said.

During Reconciliation week, she said, "we've had elders come and conduct a smoking ceremony around the school. In my experience, the Indigenous elders are humble and generous with both their time and their knowledge. Being a part of a ceremony of this nature slows you down, and allows time for reflection."

Dr Scott said it was also important to recognise that participating in events such as smoking ceremonies was "a gift that is, at times, offered to non-Indigenous Australians".

"We don't have to accept it. But when someone offers you a gift and insight into their world, and they take the time to share the knowledge behind it, and explain how it has evolved over tens of thousands of years, I would encourage acceptance," she said.

"It is good for our young people to witness and participate in experiences beyond their world, that challenge their thinking, and bring them closer to knowing our Indigenous brothers and sisters".

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Anglican priests and scholars angered

The Rev Dr John Harris, the author of One Blood, 200 Years of Aboriginal Encounter with Christianity, a seminal work on the relationship between Indigenous people and the Australian church, said people often misunderstood the nature and meaning of smoking ceremonies.

The origin of the ceremonial use of smoke, he said, "was related entirely to its disinfecting properties".

"Smoke was in fact the only large scale disinfectant available to Aboriginal people," Dr Harris said. \

"The leaves of very specific plants were used for this disinfecting smoke. The very widespread shrub Eremophila longifolia or Berrigan, for example, was used in every state and territory of Australia. Recent studies have revealed that the smoke from burning Eremophila leaves has considerable antimicrobial properties, far greater than the unburnt sap of the leaves.

"Aboriginal people chose to sleep on the smoky side of the campfire and would often throw Eremophila leaves onto the embers.

"Young men undergoing initiation with circumcision and other ceremonial wounds would sit in smoke for days at a time. Smoke was used to cleanse and protect newborn babies and mothers. Smoke was used to disinfect visitors who may be carrying infection."

Dr Harris, who has spent many years living in Indigenous communities, said smoking had survived as both a welcome ceremony and a cleaning ceremony.

Though some may describe it in spiritual terms, he said: "The people who must decide about smoking ceremonies on church property are Christian Aboriginal people. Only they are qualified to assess whether God is being honoured or not.

"We have 200 years of history of ignorant Christian missionaries telling Aboriginal people what was Christian and what was not. All manner of innocuous Aboriginal activities were banned by early missionaries.

"Banning nakedness [for example] led to huge amounts of spreading of infectious disease from unclean and unwashed ragged clothes. Hunting was said by some missionaries to be sub-Christian. Nomadic life was considered not Christian ... The list is very long."

'Time we let Aboriginal Christians decide'

The Rev Dr Geoff Broughton, pastor of St George's Church in Paddington, said a few weeks ago he had participated in the funeral of a friend and colleague, a senior Walpiri elder and lawman, and former chair of the Central Land Council in Alice Springs. It has been his "privilege", he said, to be regularly hosted "on country" by Indigenous elders.

"A smoking ceremony can simply welcome people to country or restore calm: both profoundly spiritual pursuits," Rev Dr Broughton told ABC News.

"Given the Anglican Church's ... mixed legacy with Aboriginal peoples, the ban, without any genuine consultation with Aboriginal Christian leaders, pastors or scholars, is a terrible idea."

Brooke Prentis, the Common Grace Aboriginal spokesperson, said she was pleased the motion was pulled.

The Sydney Anglican Synod should seek further advice and consultation from Aboriginal Christian leaders, Ms Prentis said, particularly theologians like Aunty Jean Phillips, Uncle Pastor Ray Minniceon, Rev Graham Paulson, Rev Patricia Courtenay, Aunty Rev Denise Champion, as well as other young leaders such as Naomi Wolfe and Safina Stewart.

Dr Harris agreed, saying: "It is about time we let Aboriginal Christians decide. If they can comfortably see the value of an ancient ceremony of cleansing and welcome, then they should be allowed to practise it.

"We have taken so much from them. There is little left for us to take. Do we want to take everything that is left?

"Personally I think that Christian Aboriginal people should be allowed to conduct smoking ceremonies if they feel it is right. They could even pray first. Smoke, the scriptures say, symbolises the rising of prayer to God."