Proposed legislation aims to change the grounds of referral, so that children enter the system only when necessary.
The number of children referred annually has increased from 26,862 to 53,883 in the past 10 years, placing a huge strain on the system. But most do not need compulsory supervision measures - the usual purpose of a hearing.
Consultation got under way this week on the draft Children's Services (Scotland) Bill.
Hugh Henry, Education Minister, said: "We know that the children's hearing system has dealt very effectively with both the needs and deeds of young people in Scotland for the past 30 years.
"But reform is needed. Current levels of referral are not sustainable, and too many children are going through the system as a way of accessing support and services.
"These plans will make sure that agencies are alert to all children, that they take action immediately and work together to provide help, without bureaucracy - so children can overcome their problems and fulfil their potential."
The proposed legislation places responsibility on organisations to work together to make clear plans for children with problems. It also seeks to take into account their views and those of their families.
This is the latest stage in the "Getting it Right for Every Child"
programme. Previous consultation showed widespread support for the system and its tenet that those who commit offences and those whose welfare is under threat should be dealt with by the same process - not least because they are often the same children.
Consultation runs till March 31.