It wouldn't be *quite* so bad if public organisations had the expertise to deal with private contractors. But actually we know in big public contracts like City IT systems* and PFI projects contractors run rings round the state/LA - and if things *don't* go their way just dissolve, walking away from the responsibility. (Happened to my daughters' school while they were there.)
*Techies often argue that the main expertise in the big companies is in writing the contracts not the code.