A child poverty lobby group has told MPs it may be cheaper to leave some long-term beneficiaries on welfare, rather than forcing them back into work.
Parliament's Social Services committee has been hearing submissions on legislation to extend work tests for some beneficiaries.
The Social Assistance (Future Focus) Bill will require sole parents on the Domestic Purposes Benefit to look for part time work once their youngest child turns six.
It also introduces harsher penalties for beneficiaries who fail to meet their obligations, such as by missing a job interview.
But Donna Wynd of the Child Poverty Action Group told the select committee on Wednesday that there is no evidence that part-time work is a pathway out of poverty.
She said well-paid, stable jobs can help beneficiaries out of poverty, but the people the bill is aimed at will not get such work.
Ms Wynd said the bill appears to have been drafted without regard to the well-being of children in beneficiary households.
The Salvation Army told the committee that balancing work and family is difficult for sole parents, and what was needed was flexibility rather than sanctions.
However, it acknowledged people become dependent on the welfare system.
The benefit changes are due to come into effect in September.