It's been very clear for decades from multiple peer-reviewed studies that secondhand smoke harms children. It's bad enough watching people smoke around their children outdoors, but it's absolutely disgusting and (in my opinion) abusive to smoke indoors around children.
Not only will those children be far, far more likely to suffer from respiratory illnesses during childhood or later life, they are more likely to develop cancer and heart problems too. Children of smokers are also much more likely to take up smoking themselves.
Why has the government not stepped in to do something about this? OK, social workers/police have a lot to do and wouldn't be able to follow up on just this one issue on its own, but even just making it illegal would help over time to reduce it, and for those parents who don't care about their child's health, it might convince them to stop smoking indoors if it could get them fined.