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Assembly of First Nations National Chief Shawn Atleo poses for a photograph in Ottawa.

With Ottawa signalling it plans to table a new law allowing first nations to sell reserve land – to members and outsiders alike – it marks the end of a campaign years in the making. Critics warn it will only alienate many first nations groups while serving no real purpose, arguing adequate land ownership laws already exist.

The debate centres on whether first nations need full land ownership, known as fee simple, to trigger housing and economic development on more than 600 reserves. In doing so, they risk giving up control of parcels of reserve land.

What's the status quo?

The housing challenges facing Canada's first nations are overwhelming: a lack of supply, pressing needs for repairs and heavy overcrowding in some cases.

Part of the problem, according to advocates of the Conservatives' First Nations Property Ownership initiative, is that first nations people don't "own" their plot of reserve land, and therefore they can't, for instance, easily take out a mortgage. Instead, it's up to band councils to build houses and green-light repairs, many of which must be approved by the federal government – a process critics say has become woefully bogged down in red tape.

"The only way to alleviate that is to have first nations be able to be empowered," says Manny Jules, chief commissioner of the First Nations Tax Commission and a former chief of the Tk'emlúps first nation in Kamloops, B.C.

Many first nations have turned to other systems of land title, short of full ownership, that allow people living on reserves to take out a mortgage and claim tenure over a certain plot of land – all while preserving the spirit of communal ownership and without opening the door to non-natives buying up land.

"What I think needs to be put out there is: let's not use up valuable time, resources and energy on creating something that already exists," says Jody Wilson-Raybould, regional chief of the B.C. Assembly of First Nations.

What would the law change?

The law would allow – not force – an individual first nation to opt in and hold the legal "fee simple" title to all or part of its reserve land. It could therefore serve as collateral for development or, for instance, prevent a band council from unilaterally moving a family. "The purpose is to free the dead capital that's here in our communities, and communities can restrict it as well," Mr. Jules says.

But it would make any "fee simple" land available to outsiders or developers. Allowing non-natives to own land would "erode our collective rights in our reserved lands," according to a 2010 resolution from the Assembly of First Nations, and "impose the colonizer's model on our Peoples."

Where has it been done before?

Several communities have some form of property ownership. The Nisga'a First Nation in British Columbia opened the door to fee simple ownership of residential land three years ago, after signing a treaty in 2000. It's seen as a foray into first nations land ownership, but the Nisga'a stress they're a different case than the law Ottawa is drafting, in that the band – not the Crown – owned the land after the treaty was signed.

The Nisga'a land project hasn't yet been implemented, but Mr. Jules's initiative, if brought into law, would essentially extend that option across the country. But other first nations have adopted a series of measures, such as long-term leases, that already deliver the benefits of land ownership to reserves without forfeiting control over the land.

Why support it?

Mr. Jules says the argument is simple: the current system is broken beyond repair. A lack of land title ripples throughout the first nations economy.

"It really hinges ultimately on our freedom, and it's an important step toward getting rid of the Indian Act," he said.

Why oppose it?

The notion could prove explosive with some first nations communities, as the AFN considers property ownership "a concept that is in direct contradiction to first nation sacred responsibilities and distinct relationship to our territories."

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