I don't see how your argument fits the situation, the government is clearly not focusing on costs if it's wasting millions of dollars on obviously not viable projects and paying consultants $200/h to sit around for months waiting for a security clearance...
There's definitely a focus on cost. It is just misguided. Short of not having security clearances, I'm not sure how you can avoid paying people to wait for them. Simple projects, like properly paying people unemployment benefits, have become not viable for the government to execute. There are many reasons why this has happened, but I think the erosion of technical expertise in the government is a big contributor. Rather than paying market rates for engineering talent, the government hires a bunch of individually cheaper non-engineers to oversee technical projects. The government could save a lot of money by hiring a handful of competent engineers rather than a ton of nontechnical management.
Relatedly, I think the government could probably save a ton of money with some in house technical talent to execute basic projects like the systems in this article rather than going through the crazy procurement process. It isn't clear to me that contractors are providing any added value to justify the added cost for their profit.