The panel's chairperson Rosslyn Noonan pointed to research that showed it wasn't so much the family separation that harms children but the conflict.
"The out-of-court services, whether it's Parenting Through Separation, giving really good quality information about the impact on children and how to support children through the process or the mediation service, they're not adversarial like the court.
"The second thing is, these services are much more accessible, can be very much quicker for people to use," she said.
The Ministry of Justice has found it takes an average of 37 days to resolve a case through mediation, compared to an average of 268 days if people go to court.
But the panel identified a number of shortcomings with those out-of-court services, including the cost to some of attending programmes like Family Dispute Resolution and the lack of free counselling.
Justice Minister Andrew Little said last week's law changes had addressed the most crucial problem - that of excluding lawyers, except in urgent cases.
That caused a huge backlog in the court, with the number of urgent cases jumping from 30 per cent pre-2014 to 68 per cent.
Little said by bringing lawyers on board from the outset will encourage more people to try to settle their differences out of court.
"And I'm confident for those parties who are looking for advice and assistance before lodging claims in court, then they will be able to more effectively engage in out-of-court processes."
The Law Society's family law representative Caroline Hickman said the changes are a win for families.
"We do believe that introducing lawyers early on, making legal aid available again so that people have access to justice, access to information, introducing the Family Justice Liaison Officers, will ensure that people get help really early on and then they won't feel like they are drifting about the system not knowing where to go next," she said.
But with no increase in the legal aid threshold, most people will end up having to pay for their legal advice.
Noonan said the estimated cost of adopting all its recommendations ranged from about $19 million to $68 million a year.
In the Covid-19 environment, that's money the Government can't afford.
Little won't be drawn on how much he asked for in pre-Budget discussions but said the panel's recommendations were never going to be introduced in one fell swoop.
"We have the work underway on really strengthening the voice of children, because that was the other issue and that is probably the most common issue I get in correspondence from parents is a lot of disappointment expressed about the support given to their children by lawyer for children, when they're appointed. So we want to improve that," he said.
The Government expects to introduce that Bill later this year.
Little said the government would eventually fund all the panel's recommendations when it had the money.
Ministry of Justice figures show the Family Court received fewer applications through the level 4 lockdown but it dealt with more urgent cases.
There was a 54 per cent reduction in applications to the Family Court but the proportion of urgent applications increased by 35 per cent.
Guardianship, mental health and family violence were the most common reasons for filing urgent applications with the Family Court during the lockdown.
Most areas saw a decrease of at least 40 per cent in the number of applications filed. Southland had the largest decrease in applications (67 percent), followed by Northern Wellington (65 per cent) and Otago (63 per cent). Wellington region had the smallest reduction with 36 fewer applications (26 per cent decrease).
