A young offender institution (YOI) criticised for failing to support a 17-year-old boy who hanged himself after being bullied is still struggling to keep its inmates safe, inspectors have warned.
YOI Hindley, near Wigan, where Jake Hardy killed himself in January 2012, has seen bullying increase and fights and assaults rise to an average of one every day.
A number of failures at the YOI that contributed to Jake's death were highlighted at an inquest a t Bolton Coroner's Court earlier this year.
Her Majesty's Inspectorate of Prison (HMIP) conducted an unannounced inspection in March before the inquest concluded and found bullying was up to 251 incidents reported in the previous six months, from 199 incidents at the last inspection.
There had been improvements to processes to keep protect boys in the institution, a former borstal opened in 1961, but the HMIP report added: "Yet despite these efforts, Hindley struggled to keep the vulnerable boys it held safe."
In one case, a boy who appeared to have fallen out with others was forced to "report" to a side room off a main association area to meet his assailants and while one boy kept watch, others crowded around to punch and kick him.
The incident only came to light when the CCTV was viewed later, inspectors added.
Chief inspector of prisons Nick Hardwick said: "The boys Hindley holds are now more vulnerable and more challenging than ever and, as in other YOIs we have inspected, the evidence of this inspection suggests a much more fundamental review is required about how best to hold these boys safely and securely.
"In the short term, it is essential that the pressures involved in expanding the young adults side, as the same time as managing budget reviews and new policy initiatives on the boys side, do not provide a dangerous distraction to managing the already high risks involved in keeping the boys at Hindley safe, secure and prepared for a positive new start when they leave."
An already high level of fights and assaults noted at an earlier inspection had increased from 28 to an average of 32 a month, HMIP said.
There had also been 167 self-harm incidents in the previous six months, continuing a rise noted at the previous visit, inspectors said.
Intimidating shouting out of windows at night remained a problem, despite efforts by staff, HMIP found.
And the inspectorate also hit out at "reckless and dangerous" proposals to withdraw funding from the jail's Willow unit, which holds up to 13 inmates with the most complex problems.
Mr Hardwick added: "It was a vital service that kept some of the most vulnerable boys safe and in my view, closure of the Willow Unit would be a reckless and dangerous development."
Frances Crook, chief executive of the Howard League for Penal Reform, said: " Hindley's first priority should be to keep all boys safe, and this is not being achieved.
"It is completely inappropriate to put young adults together with children in such a dangerous environment and the Government should reverse this decision immediately.
"This report illustrates how the Government is putting children at risk with its plan to build a huge new jail that will mix younger boys, and girls, with older teenagers with too few staff. Prisons are dangerous places for children."
Michael Spurr, chief executive of the National Offender Management Service, said: "Hindley manages a very complex and challenging population and the governor and his staff deserve real credit for the impressive progress they have made.
"As the chief inspector recognises, the young people there are being given access to good quality education, training and resettlement work which are all key to their rehabilitation.
"Safety is the governor's top priority and it will continue to be given the necessary focus as they build on the progress made and take forward the recommendations."
Jake's mother Liz Hardy said: "Reading this report, it appears that not enough has changed at HMYOI Hindley, two and half years on from my son Jake Hardy dying.
"The recommendations that the inspectorate are making are the same as those that came out of the inquest: in particular in relation to the problem of shout-outs at night, bullying incidents, the need for better internal recording and passing-on of information; and the need for improved care of vulnerable young people with learning difficulties.
"It is distressing knowing that another family may have to go through the heartache and heartbreaking experience that we as a family had to suffer."