I think you're forgetting the "public servant" part.  What these government employees are doing every day is what keeps our government running - yes I know that there are numerous rabbit hole arguments against the performance of government employees but it doesn't change the fact that these people are taking serious pay cuts by working in the government sector.  The ERS is compensation for the relatively low salaries that government employees make compared to the private sector.  

I agree with you that there are bad apples.  In any job, a person is either intrinsically or extrinsically motivated to work.  Arguably the #1 factor is money which is extrinsic motivation.  Without comparatively equal salaries to the private sector, what motivation does one have to over-perform one's job?  It is rare to find a person who genuinely works to do their best because they take pride in their job, regardless of whether they're being paid drastically less than their private sector equivalents.