I wish that I could disagree with you Jeebus, but I'm in the middle of it and I can't.
It does not necessarily follow that IT run by civil servants must be intrinsically inefficient. When I was employed by the Inland Revenue (i.e. up until 1994) the entire IT function was performed by 1800 staff. That was everyone: developers, admins, network people, DB admins, output operators, heck even the security guards. Munge in the Customs and Excise people and there weren't many more than 3000 bodies doing all the IT for the work now covered by HMRC.
Roll forward to today, nearly 20 years on from privatisation of all the work into the hands of EDS, Accenture, Capgemini, Fujitsu, BT and assorted other alickadoos and there are nearly three times as many people employed to deliver the kit and the software and still around 3000 civil service types managing the contract. Half of these people are duplicating effort on either side of contractural boundaries, while another third are entirely focused on either fucking over the customer and/or the other contractors or making sure that they aren't fucked over in turn by the customer or the other contractors. There are probably still the same number of people doing the actual work, but they are vastly outnumbered by the huge panoply of paperwork and governance drones buzzing around them.
As a taxpayer, I get depressed at how much taxpayer's money I am paid to waste, but that's my job these days.