The report of an HMI inspection of the school, ordered by the Education Minister and published on Monday, is unusually hard hitting. It says in effect that Donald Macdonald, the rector, is a consensual manager but weak leader. The report is also critical of long-standing “tensions and their detrimental effects” in the relationship between the school and Neil Galbraith, the council’s director of education.

The council has been holding two investigations of its own: one by Brian Stewart, the chief executive, on the school’s external relationships, and another by Mr Galbraith on its management structure. Mr Stewart said the Inspectorate’s judgments were in line with the council’s findings.

The Nicolson Institute’s recent troubles began with the suicide of a 16-year-old girl in February, seven weeks after she had been assaulted out of school hours by two fellow pupils who were subsequently sentenced to three months’ detention. Mr Macdonald appeared on television to say the school had no bullying and was accused by councillors of “complacency”. He in turn said they were showing “ignorance and ill will” towards the school.

The rector was then given a written warning about unauthorised contact with the media. His appeal against the warning is due to be heard today (Friday).

The report from HMI appears to confirm local anxieties by noting “serious weaknesses in the way the Nicolson Institute deals with bullying”. There were no “exceptional levels” of bullying, inspectors said, but the school should deal with incidents more vigorously.

Of Mr Macdonald, inspectors say: “The rector is seen as approachable by most members of staff, is responsive and helpful to those who come to him, and seeks to manage by consensus. He does not, however, give a clear sense of direction in major policy matters.”

He was judged not to have given a sufficient lead on pupil care and welfare, the main focus of the inspection. Nor had he encouraged self-evaluation of the guidance system or established a partnership with parents.

HMIs found fault both with the guidance policy and the way it was implemented. “The brief school policy on bullying was drawn up by members of the senior management team without sufficient consultation with staff or the school board,” the report states. Some register teachers did not even know who the guidance teacher was with responsibility for their pupils.

The school is urged to give all teachers sufficient training to improve pupil care and welfare. The Inspectorate will carry out its normal follow-up visit to check on progress within 12 months.

The more long-standing concern, however, is over the fraught relations with the director of education. HMI, in the unusual form of an addendum to the report, confirmed that these tensions and “a climate of distrust and suspicion . . . inhibit and distort aspects of the school’s work and adversely affect staff morale. There is clearly not a harmonious working relationship between the school and the education authority. For example the school staff feel that the director of education intervenes at an inappropriate level in the day-to-day working of the school. For his part, the director is concerned that the school does not implement authority policy with sufficient vigour.”

The recommendation that the council set up a working group, chaired by the chief executive and including Mr Galbraith, Mr Macdonald and the school board chairman, has been accepted. Mr Stewart said this would be “an important vehicle for closer working relationships and improved communications”. Mr Macdonald, temporarily released from the council’s ban on contacts with the media, promised to pursue the recommendations “with vigour”. He drew strength from the report’s praise for the orderly atmosphere in the school and generally good relationships between staff and pupils.

Brian Wilson, the Education Minister, appealed to “everyone involved to look to the future rather than the past”.

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