A hospital trust has been granted an interim, £36m contract to run community services in London for two years, after the incumbent provider said it would not bid for a renewed contract.

Epsom and St Helier University Hospitals Trust has been announced as the winner of the contract in Sutton, on the London-Surrey border.

The contract will begin in April 2019, when The Royal Marsden Foundation Trust’s three year contract comes to an end.

The Royal Marsden, which is best known for providing specialist cancer services from its main site in Chelsea, has run Sutton community services since 2011. It also has a smaller facility in the borough, which will be expanding with a new research centre, using largely charitable funds.

Sutton Clinical Commissioning Group confirmed the contract had not been tendered and it had taken legal and procurement advice before offering the work to the trust.

Epsom and St Helier provides acute services from two main sites in London and Surrey, and hosts the contract for Sutton Health and Care Provider Alliance – an arrangement involving the trust, the local council and the CCG. A similar arrangement is being developed in Epsom.

In a statement, the CCG said: “Having taken extensive legal advice, the CCG took the decision to make an interim, transitional contract award to allow the CCG and Sutton Health and Care Provider Alliance partners to develop an integrated model of care, as this outcome could not be delivered through a competitive procurement process at this time. This two year period is essential in order to allow us to continue to develop the new Sutton Health and Care model of integrated care.

“The competitive procurement will be taking place within the next two years. This fits within the original contract timetable.”

CCG clinical chair Jeff Croucher said: “We are excited about the new model of care for local people in Sutton that we are developing, with a focus on keeping people well and out of hospital. We want to take the time to engage with staff, patients and our partners to get this right for the future.

“This is an interim change about the management and hosting of the services. The way the staff care for patients day to day will stay the same in the short term.”

Hospital trust taking over community contract after specialist drops out