That is true for oh so many government IT projects. The part that I still struggle to comprehend is "Why on earth aren't the IT companies, like IBM, telling governments that what they're asking isn't actually possible?"
The Danish government have an insane amount of failed IT projects. Most of them fails do to the complexity of laws, rules and requirements. We even know that they'll fail before they even start. Most good developers are able to predict this with great accuracy. So why aren't IBM and other telling governments that what they're asking isn't possible?
My best guess: Because their lawyers will ensure that they're paid anyway, and because they have absolutely no pride in their work.
You can't hurt the reputation of IBM, or at least it won't matter, because their competitors have equally poor reputation, and no one else is going to bid on the jobs they take on.