Off the top of my head, I can point to several probable causes of this incredible ineptitude:
1. Hiring the cheapest possible labor to input data. Guess what? If you don't pay people a decent salary, they're going to think of you just what you think of them. Secondary analysis: the pay rates are so poor that intelligent, literate, responsible people don't have any interest in these jobs. Data entry may not look like it requires brains, but it's difficult, tedious, fatiguing work, and for that reason alone deserves reasonable pay.
2. Hiring PC types as managers. This seems endemic under NuLabour: maybe I'm just expressing my misogynism, but all too often when there's a major cockup in the NHS or social services, there's a woman at the head of the organization. In addition to sex, other PC characteristics are probably also used, rather than "is the person competent to do the job?" I'm thinking of skin color, ethnicity, place of residence, total contributed to the Labour Party and so on. [Actually, that's not hiring for PC reasons. It's just good old fashioned corruption.]
3. The Blairite fixation on statistics, targets, goals, graphs, databases, etc, as though these are ends in themselves instead of merely indicators (and not necessarily good ones) of how well the job is being done. Sometimes I wonder if the Scientologists have infiltrated Whitehall and introduced Hubbardistic management methods.
4. The sheer stupidity of the people in charge. They love government by tabloid headline, and never think beyond some superficial solution to a problem. Result: side effects and unexpected consequences. I am flabbergasted how often HM Government comes up with some stupid, cockamamie idea to solve some trivial problem in society. I would have thought that the ministers of the Crown had more important fish to fry than worrying about people's waistlines. Not only stupid, but shallow and badly educated: so much is clear.
[Please note that per my promise of a few weeks ago, I have named no names.]
Just as Barack Obama is going to have his hands full trying to undo the mess that Bush, Cheney, Rove, and Rumsfeld have created, so whoever forms the next government in the UK is going to have little time for anything but sorting out the administrative problems resulting from NuLabour's idiocy.