Basically, yes. Bring it all in-house, ban the contractors/consultants/mercenaries/etc. Remove the profit motive and suddenly you don't have millions of dollars/pounds being siphoned off by vampiric consultancies and third-party vendors. Suddenly you can spend tax-payers money in a sane and rational way.
Hire a bunch of talented people who care about the wellbeing of their nation state, pay them well enough and task them with building the best systems possible in the most efficient way possible.