Tasmania's outgoing ATSIC commissioner Rodney Dillon says the return of land to the Aboriginal community is something that needs to be tackled in stages.

Premier Paul Lennon has told Parliament the return of Cape Barren, Goose and Clark Islands to the Aboriginal people will enable the State to begin healing wounds that have existed for more than 200 years.

In his State of the State address yesterday, Mr Lennon said the land's transfer to the Aboriginal community is on track.

He urged his parliamentary colleagues to support the move, saying a "new Tasmania" must include reconciliation.

Mr Dillon says the land's return is welcome, and while he also wants other areas of the land returned, he says a different approach is needed.

"We've tried in the past of getting big areas of land and it hasn't worked," he said.

"Now we've got to chip away and negotiate on area in specific places and get areas all around the State."

Non-Aboriginal residents of Cape Barren Island will still have access to foreshore areas and infrastructure once the handover is complete.