Governments indeed have the requirement to use the least costly bid. I wonder if that's actually part of the problem.

Although, I really don't know how to make the rules better.

Anyway, from personal, anecdotal experience, I have hired building contractors, first time around I took the cheapest offer, then two years later I needed the same work done for another room and then didn't take the cheapest offer (the one I took was about 25% more). The result could not have been more different. The cheap room has cost me more than 2x the original price, because I've had to redo most of it during the last 7 years and the second room shows no signs of needing any more work anytime soon.

So, taking the longer term view, sometimes it's better to pay more upfront to get more quality. Except that quality in this sense is really hard to quantify and put into rules.