In 1871, the Canadian government entered into Treaties 1 and 2 to obtain the consent of the indigenous nations from the territories set out respectively in each Treaty. The Treaties provided for the taking up of lands "for immigration and settlement". The Dominion Lands Act (short title for An Act Respecting the Public Lands of the Dominion) was an 1872 Canadian law that aimed to encourage the settlement of the Canadian Prairies, and to help prevent the area being claimed by the United States. The Act was closely based on the United States Homestead Act, setting conditions in which the western lands could be settled and their natural resources developed. In order to settle the area, Canada invited mass emigration by European and American pioneers, and by settlers from eastern Canada. It echoed the American homestead system by offering ownership of 160 acres of land free (except for a small registration fee) to any man over 18 or any woman heading a household. They did not need to be British subjects, but had to live on the plot and improve it.
The Act is controversial because the Canadian Government—established by Confederation only five years earlier—was extremely short on funds and never provided compensation to the indigenous nations[dubious ] for the use of the lands which the Government had decided to give away for free.
Unlike in eastern Canada, the federal government had assumed control over public lands and natural resources in most of western Canada. Its jurisdiction to do so is controversial with First Nations, who assert they were not only not compensated for their lands, but that only the lands taken up for immigration and settlement were covered in the Numbered Treaties, and that other lands and natural resources were not covered.
The Act was applied to the province of Manitoba and to the Northwest Territories. Upon the creation of the provinces of Saskatchewan and Alberta from the Northwest Territories, the Act continued to apply to them. It was also extended to the Peace River Block of British Columbia. In 1930, the federal government agreed to transfer control over the public lands and natural resource to the prairie provinces by means of the Natural Resources Acts. From that point onwards, the Dominion Lands Act only applied in the North-West Territories.
The act gave a claimant (160 acres, or 65 hectares) for free, the only cost to the farmer being a $10 administration fee. Any male farmer who was at least 21 years of age and agreed to cultivate at least 40 acres (16 ha) of the land and build a permanent dwelling on it (within three years) qualified. This condition of "proving up the homestead" was instituted to prevent speculators from gaining control of the land.
The act also launched the Dominion Lands Survey, which laid the framework for the layout of the Prairie provinces that continues to this day.
An important difference between the Canadian and U.S. systems was that farmers under the Canadian system could buy a neighboring lot for an additional $10 registration fee, once they had made certain improvements to their original quarter-section. This allowed most farmsteads to quickly double in size, and was especially important in the southern Palliser's Triangle area of the prairies, which was very arid. There it was all but impossible to have a functional farm on only 160 acres (0.65 km2), but it could be managed with 320. Canadian agriculture was consequently more successful than U.S. agriculture in this arid region.
Bloc settlements were encouraged by section 37 which allowed associations of 10 or more settlers to group their houses together to form a settlement to fulfil their cultivation obligations on their own homestead while residing in a hamlet.
The success of the Dominion Lands Act overall is questionable. Large-scale immigration to the prairies did not get underway until 1896 (immigrants prior to then generally preferring to live in the U.S. due to a protracted recession in Canada that followed confederation)[dubious ]. Also, the first version of the act set up extensive exclusion zones. Claimants were limited to areas further than 20 miles (32 km) from any railway[dubious ] (much of the land closer having been granted to the railways at the time of construction). Since it was extremely difficult to farm wheat profitably if you had to transport it over 20 miles (32 km) by wagon, this was a major discouragement. Farmers could buy land within the 20 mi (32 km) zone, but at a much higher price of $2.50 per acre ($6.20/ha). In 1879 the exclusion zone was shrunk to only 10 miles (16 km) from the tracks; and in 1882 it was finally eliminated.
Less than half the arable land in the West was ever to open to farmers for homesteading under the Dominion Lands Act. The Canadian Pacific Railway owned most of the rest[dubious ], as part of its charter for building the transcontinental railway. The Hudson's Bay Company, which had once owned the entire prairies, had kept 5 per cent of the land as part of the terms of its surrender of its charter. These two companies sold land to land companies and to farmers on the open market. Additional areas were set aside for schools and government buildings.
Overall, about 478,000 square kilometres (118,000,000 acres) of land were given away by the government under the Dominion Lands Act.
Some historians argue that the Dominion Lands Act encouraged premature settlement of the West since many of the farms settled under the act later failed.
From 1930 onwards, the Act only applied to the public lands in the Northwest Territories. The homestead provisions of the Act, designed to encourage agricultural settlement on the prairies, had little application to the conditions in the Northwest Territories. Parliament repealed the Act in 1950, replacing it with the Territorial Lands Act, which was better adapted to the conditions in the Territories. The new Act did not contain any homesteading provisions.