People tend to think of the Government as that supra-natural entity, that has the best brains working for them and withhold all the secrets most people would love to know (aliens, cure for diseases, high tech, etc.).
Actually, government staff is composed of politicians, public employees and a lot of people (some very skilled and competent and some are just stupid leeches who want to have a nice calm job and don't want to have to worry about it).
Having said that and knowing that, according to the papers, "the Police took him for a muslim terrorist and was after him for the past two days", I think that they were just stupid, unprepared Policemen, who commited a big mistake. But when Policemen commit mistakes, someone might die.
I don't believe in any conspiracy theory that puts the Government as this orwellian Big Brother that knows everything. Generally, it's the opposit: weird things happen more on a random basis and not on a well elaborated strategy.