You're writing from the government side of the coin.  If we don't pay people not entitled, then we are saving money.  Yes the state will pay out the same to fewer applicants, but we for whom the state exists will have more, i.e. saving money.  
I'm not favoring the bid process, nor apparent cronyism. I am all for rooting out fraud; it costs us all floods of money.  If we can reduce it, we save. It's the right thing to do.