You're assuming the government controls the development process. That's not the objective (and frankly, FOSS licences works against control, as any party can fork the code). Rather, the suggestion is for governments to support FOSS developers, just as they do the arts community, without directly dictating what work they do. If they want a project extended in a certain way they can pay directly for that development, but they should do it on the back of an existing product that serves the general community and feed useful development of the software from their extension back into the general development tree.
Standards may help commoditize the more fundamental parts. It was the government that created ASCII and SQL after all. At least back when they cared about competition.
