Not at all, all it requires for the government (or its agencies and workers) to perform poorly, is the guarantee of payment for nothing. Oh wait, they already do get paid even when they fail. In fact, when government businesses fail, they often get given more money, not less.
When a private business fails, they don't get to just "tax" everyone more to make up for it, the owners and investors lose out! This is a necessary as a sort of signal that resources are not being used well and that they are better off used somewhere else.
When the government circumvents this process of resource reallocation (by stealing the cash and redirecting it elsewhere), everybody is worse off for it.