Neither government agencies or crown corps are perfect, but at least they're not inherently flawed either. Yes they're subject to different circumstances than market companies, but that can be dealt with. Capitalism's inherent drive to cut corners and destroy the environment can't.
Other places in Europe seem to be even worse. For example, I've seen people from Ireland shocked that thsi would happen and preaching the benefits of their state-owned water and their fight against privatisation and water billing. There are places there which literally have no sewage treatment plants still. As in, their sewage goes straight from their houses into the rivers and the sea untreated, not because of a fault or undersized treatment plants or heavy rain ( all of which they have problems with too) but because the sewage system is literally designed to do that 24/7. The government was meant to have fixed this decades ago according to EU rules but has kept dragging its feet on building sewage plants. And they're probably not unique - they were literally the first country I checked, and the second, Spain, had the same issue as well.
No, the problem does not go away. You start optimising for short term political goals (see also: ongoing property debt crisis in China), and minimising short-term drama (see also: regulatory capture by unions). Sometimes you also start implementing insane projects just because your glorious leader decided to do them and cost/value is not an issue (see also: Chinese war on sparrows). Sometimes you just minimise the expense and make everyone disagreeing with you shut up, because they don't have a choice either way (see also: Chernobyl not having containment). You also get way less feedback, because you're spending someone else's money (i.e., taxpayers'). So no, "government consists of decent people and they won't optimise for the short term even though they are doing it now because there'll be no commercial company controlling it" is a very optimistic take at most and definitely not a realistic one.