
Sunderland's children's services was rated "inadequate" by Ofsted in July 2015 and was taken over by community interest company Together for Children (TfC) earlier this year.
Following its fifth monitoring visit, which took place last month, the inspectorate found that the mutual has made particular progress in improving services for children in need of help and protection.
They praised timely decision making on referrals and improved quality of management oversight.
Inspectors also noted improvements in children's social worker recruitment and support of staff. All members of the integrated contact and referral team are now permanent and 75 new starters have joined since April, they found.
"Staff receive supervision on a regular basis. Case discussion is, in the main, detailed. There are opportunities to discuss personal development and human resource issues," states Ofsted in a letter to Sue Carty, the operational lead for TfC.
The letter adds: "TfC is making sustained progress in improving services for children in need of help and protection.
"There is evidence of progress in many areas, including the timeliness of decision making on contacts and referrals, improved management oversight and better staff stability in some teams. Clear strategies are being developed to support practice and address staff recruitment."
Despite the praise, inspectors are concerned about the high number of re-referrals and the timeliness of assessments. They also noted that the use of agency staff within the assessment team is still high, at 50 per cent.
"There are still significant areas of performance and practice that need to improve, especially in respect of the high number of re-referrals, the timeliness of assessments and management oversight of the quality of practice," Ofsted's letter to TfC adds.
"TfC now needs to strengthen its focus on the quality of social work practice, especially in improving assessments and planning to ensure that the life experiences and outcomes for vulnerable children improve."
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