Australia's youth justice and incarceration system is being examined by a Senate committee in Sydney on Friday.
Anne Hollands, who recently completed a five-year term as National Children's Commissioner, told the committee youth crime was "predictable and preventable", and a punitive approach was not the answer.
States and territories have introduced tougher measures to combat youth crime including lowering the age of criminal responsibility, adult time for adult crime and removing the principle of detention as a last resort.
Ms Hollands told the committee Australia had gone backwards on the human rights of children, and of particular concern was the high rate of incarcerated Indigenous children.
"I'm deeply disappointed that we're lagging on these issues and we're using the federation as an excuse not to act at the Commonwealth level, because the states and territories, variously, are failing" Ms Hollands said.
"We need the Commonwealth to lean in on this and provide stronger leadership."
Crime by children was predictable when poverty, poor housing and parenting, domestic violence, disability, racial discrimination and poor school attendance were factored in.
"I've had seasoned police sergeants tell me they can tell who's going to end up doing crime when they're four or five years old," Ms Hollands said.
"They know what the determinants are."
Ms Hollands said she had heard of First Nations children being sent home from school for wearing socks of different colours when their attendance in the first place should be celebrated.
Government health, education and other agencies needed to prioritise child wellbeing and address the shortfalls in troubled children's lives rather than have them incarcerated to be trained as criminals, she said.
"Despite being a rich and developing country, Australia is lagging other countries on the rights and wellbeing of children and governments are failing to implement evidence-based laws and policies."Â
Justice and Equity Centre CEO Jonathon Hunyor told the committee locking up children did not make communities safer but led to more crime and harmed children.
"The younger a child is when they're exposed to the criminal justice system, the more likely they are to reoffend and be imprisoned as an adolescent and as an adult," he said.
"Decades of evidence has made this very clear but in almost every Australian jurisdiction we send 10-year-olds to prison.
"That's kids in year 5, that's kids with their baby teeth, that's kids who we don't let go to the shops on their own because it's simply not safe to do so."
There were diversionary programs and other alternatives to custodial sentencing.
Mr Hunyor called on federal parliament to raise the minimum age of criminal responsibility nationwide to at least 14 and impose minimum standards for the treatment of children in all jurisdictions.
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