Despite success by complainants, system has been criticised for being too slow to act.
An advisory panel set up in 2008 to hear complaints against child protection services has at least partly upheld 33 of the first 40 cases it has heard.
The panel, which advises the Social Development Ministry chief executive, may soon be replaced by an independent authority after a review by former Police Commissioner Howard Broad, announced this month.
Panel members upheld 12 complaints in full and another 21 in part. Only seven complaints were not upheld. It has paid compensation to eight families totalling $75,000.
But Greymouth advocate Graeme Axford, who obtained the data under the Official Information Act, said the panel's processes were too slow and it was still not genuinely independent.
"By the time you have been to the end of the complaints process, yes 80 per cent have been upheld, but it's too late because you can't retrospectively fix the issues that led you to have to go there, so it's really like a slap on the hand with a wet bus ticket," he said.
Wanganui caregivers Angela and Grant Rogerson were awarded $10,000 compensation for not getting adequate support from Child, Youth and Family Services during a four-year campaign against them by a mother whose two children Cyfs had placed in their care.
They were awarded another $5000 for breach of privacy when Cyfs gave the mother documents detailing unproven allegations against them.
But Mrs Rogerson said the mother's campaign cost them $700,000 by driving customers away from Mr Rogerson's computer business, forcing him to close the business after 20 years. Mrs Rogerson also had to give up her job managing a motel and stopped working as a caregiver.
A central North Island grandmother was awarded $7500 compensation after a three-year struggle to get legal care of her grandson, but is appealing to the Ombudsman because she had to give up her job and move to the South Island, where her grandson lived. Her daughter, the boy's mother, lived with a partner who assaulted the boy.
"When I first got my grandson I was told he was not allowed to see my daughter," she said.
"How are you supposed to have a relationship with your daughter and your grandson when they are not even allowed to see each other?"
Family First director Bob McCoskrie said the Government should create a genuinely independent Cyfs complaints authority immediately, without awaiting Mr Broad's report.
"The evidence shows that Cyfs is making mistakes," he said.
A spokeswoman for Social Development Minister Paula Bennett said Mr Broad would conduct the review alone, but would consult others as part of the process.
His three-point terms of reference include the financial and legislative implications of "options for independence", but he "will not re-examine any particular case investigated by the ministry or panel". He will report by next June.
AUT social scientist Dr Emma Davies called for an authority with a broader role of regularly monitoring all Cyfs branches in the same way that Britain's Office for Standards in Education, Children's Services and Skills monitors both children's services and schools.
The Broad review
Ex-police chief Howard Broad will investigate establishing an independent complaints mechanism for Child, Youth and Family. He will consider:
1. The current arrangements for members of the public to have a complaint about Child, Youth and Family heard.
2. how the current arrangements are working.
3. Options for independence and the financial, legislative and accountability implications of these options.