A helpful way to think about this is that every exclusive right created by IP law, patents included, is granted subject to the state's residual power to act in the public interest. The Patents Act builds this principle in as a direct carve-out for Government use.
Balancing the patentee's exclusive right against the Government's public-interest power points to the Government being free to use the invention for its own purposes without the patentee's consent.
A practical way to test these options is to imagine the Government needing a patented invention urgently, say for a public health programme or national defence project, and ask which option describes something the law would actually allow to happen.
Testing each option against a realistic scenario of urgent Government use shows that only the option preserving the patent while allowing consent-free Government use for its own purposes matches how the law actually operates.
The correct answer is therefore The Government may use the invention for its own purposes without the consent of the patentee.