PERTH, April 17 - The Office of the Inspector of Custodial Services report, released on Tuesday, found education was "one of the biggest casualties" of a lack of strategic direction at the Banksia Hill Juvenile Detention Centre.

Education services did not meet community standards, and the school was poorly resourced and understaffed.

If significant progress was not achieved over the next three years, responsibility might be better transferred to the Education Department, the report found.

The Justice Department says some recommendations are already being addressed, including re-establishing the school principal position, a separate education budget, introducing a protective behaviours program, and developing an education and training strategic plan.

The report also found executive and senior management at the facility were highly changeable and there was an inconsistent approach to managing youths.

Acting Inspector Andrew Harvey said Banksia Hill had been plagued with "volatility, instability and uncertainty" since it became the sole custody option for youths six years ago.

"A single centre cannot meet the needs of such a diverse and high-need group of young people ... no other state or territory has such a large facility or a one-stop shop," he said.

"There are too many young people in the one place."

Following a riot in May, the centre began operating under a "tightly-controlled and restrictive regime", which reduced young people's movement and limited their involvement in activities.

The report also noted complaints from girls about the laundry process failing to ensure they had their own underwear returned, but that problem was immediately addressed.

A crisis care unit has also been recommended.

Some improvements over the past nine months include a general sense of safety for juveniles and staff, a reduction in strip searches, good policies for managing transgender and transsexual youth, and better record keeping.

The incidence of self-harm also dropped slightly from 191 in 2016 to 184 last year, but it is still much higher than the 37 cases in 2014.

Human rights lawyer for the National Justice Project, George Newhouse, labelled the detention centre a "stain" on the state's justice system.

"Instead of locking up and punishing these kids, they need specialised medical care, education and a sense of identity through their culture," he said in a statement.

The organisation indicated it was considering taking legal action against the government on behalf of the Banksia Hill detainees.

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AAP