What does it mean to practice with a child? The words "go practice" are simply not enough - especially with younger children. Before the age of 8 or 9, these words hold no meaning for a child, because the act of practicing--controlled repetition for a desired result--is impossible for a child to do well alone. Young children are not self-aware enough to control their mental habits during extended or complex tasks, and this makes solo piano practice almost impossible for them.
The solution to this problem may not be easy, but it also is not complex. Every day, during your child's practice time, sit with him or her and work through the lesson assignments together. You don't need to be a drill-sergeant, but you do need to help keep your child focused, motivated, and on task.
Some people think that monitored practice is too strict. This doesn't need to be the case however; you can and should allow your child to have fun and experiment after monitored practice is over. The excuse that twenty or thirty minutes of practice is too long a period to concentrate doesn't stand up to experience either. Children will adapt well to focused practice once a routine is established, and will be motivated by the skills they develop.
The benefits of daily guided practice with your child are enormous. You will see progress that dwarfs previous experience, spend quality time together, teach the value of long-term applied effort, and greatly improve communication during lessons.
The most common complaint--that parent and child are too busy to practice together--says more about modern parenting than is does time management. All effects have causes. If the effect you want is a child who is successful in music, help initiate the cause: intelligent daily practice.