Children younger than 12 should be exempt from the "rule of six" limitation on social gatherings, according to a report by the Children's Commissioner.
The report claimed children have been overlooked by policies aimed at curbing the spread of coronavirus and urged the Government to put their interests first in the event of a second national lockdown.
In addition to exempting young children from the "rule of six", the report recommended excluding them from restrictions on individuals mixing with different households so they can continue to play together.
The report by the Children's Commissioner's Office showed the first six months of lockdown "compounded existing inequalities" for the 2.2 million vulnerable children living in risky home situations in England.
This includes nearly 800,000 children living with domestic abuse and 1.6 million living with parents with severe mental health conditions - and the report warned these numbers are likely to have swelled over lockdown.
Some 41 per cent of schoolchildren also reported feeling more stressed about exams when schools closed at the start of March, according to a survey by the office.
Children's Commissioner Anne Longfield said many of the decisions taken during the first lockdown, such as reopening pubs and restaurants before schools, "have not put children first".
She said: "Children have fewer health risks from Covid-19 and yet they have suffered disproportionately from the nation's efforts to contain the virus.
"Unless the Government acts now, Covid-19 is in danger of becoming an inter-generational crisis, with the impact of the economic fall-out on parents determining the future prospects of their children.
"This would decimate the Government's ability to level up opportunity across the country in the way the Prime Minister has repeatedly promised to do."
"After all the sacrifices children have made over the last few months, we should repay them with a comprehensive recovery package, 'a Nightingale moment', that puts their interests first," she added.
Ms Longfield argued the Government's efforts to "build back better" must focus on investing in children, including continuing the £20 uplift in Universal Credit and Working Tax Credit for families beyond the current end date in April, and adding £10 per week for child payment.
The report also called for greater investment in local early help services, the Troubled Families programme and health visitors, and for schools to be able to use the £1 billion catch-up fund for vulnerable and disadvantaged children rather than on supplies like PPE.
It urged local authorities to ensure disabled children's services can continue to operate and on the Government to provide additional funding for this if necessary.
Recommendations also included pushing summer exams back as far as possible while still ensuring children receive results in time to progress to college or university.