There're a number of things to consider...
What most people fail to understand that HMG is probably using and controlling their systems with AD, and as other browsers don't tie themselves into AD, the admins would not have control, unless the browser update is to a more recent version of IE.
Also, what do you think they would do when they realised that all these 'In porn' modes made logging what people were doing impossible to follow?
My impression is that HMG is using IE6 specific ActiveX controls, like a lot of big corporations of the early XP generation and that they would have to rewrite those or all those applications that they use that use them to be able to move away from IE6. Personally, I think that they should never have been allowed to go the OS specific integrated route as it's a lock in to a specific platform. All their apps, both front end and backend, should be fully portable to other OS and browser platforms.
It is a good argument for public oversight of governmental IT projects, so that we the tax payers don't get screwed over, and over, and over.
I also think it's outrageous that the government would publish a statement that insinuates a lie, that they don't need to do anything because there's no evidence that that the latest fully patched browser from MS is any less secure than alternative browsers. All well and good, if they were using IE8, but they aren't using the LATEST fully patched browser from MS, they're using IE6. And probably systems that are not fully patched either, so two lies?
Also CanSecWest has had IE8 crumble during its competitions every year that it has been out. Only one desktop browser remains uncompromised at that event, and that's Google's Chrome browser. So there is the evidence that there are alternative browsers that are less insecure than IE8.