Oakbank in Aberdeen, the independent residential school dogged by controversy, has been "taken off the critical list" following a further HMI investigation. Inspectors will return later this year to monitor progress.
Jane Arrowsmith, the new principal, is credited with turning around a school that was the focus of a special inquiry after claims about "serious failings" in leadership, curriculum organisation and pupil behaviour. Oakbank's board is now controlled by Aberdeen councillors who recently agreed to hike fees by 40 per cent.
The improved report comes amid further concern after a member of staff was charged with a minor assault. A report has gone to the procurator.
Last year inspectors commented on inadequate progress in a number of areas. Now they say the 48-pupil school for teenagers with emotional and behavioural problems offers a balanced curriculum, is implementing new policies on learning and teaching, and has drawn up draft policies on personal and social education, homework and assessment.
The inspectors say: "The new principal has given a renewed sense of purpose and direction to the school and was displaying very good leadership skills."
Ms Arrowsmith said: "We have been taken off the critical list and we are looking forward to the inspectors coming back."
The inspectors expect further progress. "The incidence of disruptive behaviour remains too high," they note.