From Carter's Article, Page 11:
"Bolstering the argument that Indian reserves were far too large, and constituted "vacant" land was the fact that government policies since the late 1880s had served to inhibit agricultural expansion. A "peasant" farming policy had been implemented on many western reserves where farming just at the time when agriculture began to show some promise. Reserve farmers were told to limit their land under cultivation to one or two acres, and to use the most rudimentary implements such as the hoe, sickle and cradle. They were to broadcast their seed by hand, just as in biblical times. This policy was clearly devised in response to complaints about "Indian competition" in the limited markets of the West. Non-Aboriginal people in Western Canada widely shared a duster of beliefs about Indians on reserves, and one of the most powerful of these was the notion that government provided them with all they needed to farm, even rations, and that this gave Indian reserve farmers an unfair advantage. There was little understanding in the non-Aboriginal community about what was solemnly agreed to in the treaties, and there was little knowledge of the restrictions upon Aboriginal enterprise contained in the Indian Act, but there was this strong perception of unfair "coddling," a misperception which persists among some non-Aboriginal Westerners to this day. The peasant farming policy was designed to diminish Indian reserve production to just subsistence level, leaving these farmers without a surplus to sell. This policy, unpopular with Indian reserve farmers, most of the Indian agents, farm instructors and inspectors of agencies, was hastily dropped shortly after the 1896 change in government, but it had the effect of discouraging an interest in agriculture, and there were reserves upon which formerly cultivated fields were idle. The peasant farming policy was introduced at the same time as a costly effort to subdivide portions of reserves into forty-acre lots. This was ostensibly intended to encourage a form of individual ownership, but it was also designed to make settlement on reserves more compact, in order to leave portions of reserves "vacant." In 1886, John A. Macdonald himself expressed his enthusiasm for this plan which would define the surplus land on reserves, which might be sold.
It is not surprising then, that in the early decades of the twentieth century, there was land on some Indian reserves that appeared to be "vacant," and "unused," although these expanding communities could ill-afford to give up valuable land and still sustain farming and cultivation. In Western Canada however, there was much greater public concern over other vacant, unused and unproductive lands, and these concerns were expressed with particular vigour during and just after World War I. These were the vast acreages held from production for speculative purposes by the railways, the Hudson's Bay and other companies, and individual land speculators. The Grain Growers' Guide estimated that there were 30,000 acres of good farm land in the three prairie provinces in districts served by the railway that were "absolutely idle," were inhibiting settlement and distorting its pattern. This land was a "national asset provided by the Creator for the use of mankind," but "a comparatively few men and corporations have hogged it." If this land could be brought under cultivation it was hoped that many of the problems of the West could be solved, as immigration would be encouraged, traffic brought to the railways, and compact settlement created." (11).
Carter, Sarah. ""Infamous Proposal:" Prairie Indian Reserve Land and Soldier Settlement after World War I." Manitoba History, no. 37 (1999): 9-21.