As a practical matter, there would need to be exemptions (and usually are). There is closed source software used by government that has no open source equivalen

As a practical matter, there would need to be exemptions (and usually are). There is closed source software used by government that has no open source equivalent, is unlikely to have an open source equivalent in the foreseeable future for various reasons, and the government has no leverage to force the companies to make their software open source. Some things can be open source, the government already uses a lot of open source in many countries, but the government has little recourse if providers of critical software capabilities refuse to do business under those terms.