If it was publicly funded or not makes no difference.
Nobody, not you, and certainly not the government, get to decide what art is and is not of merit. If money is given to an artist to produce art, the thing you get is the art you spent money on*.
Now, if anyone here wants to go flinging shit and such on the government's dime, and you are capable of producing art such that the government gives you a grant to produce your art, sure. Do that. But I doubt you have the chops to get selected in the first place.
It is an authoritarian fascist viewpoint to then gatekeep what art is an acceptable product for the money. It is controlling free speech. The government may not decide what is and is not art. Nor may Derec. Nor may Metaphor. It is not your right, or your privilege.
If you don't like artists creating art of jizz, shit, and piss, too fucking bad.
*There are exceptions that exist in the realm of commission, insofar as something may be requested as a condition for payment. But then you are paying for a specific work; what you get is a collaborative piece, which is partially your art, and you get to decide what you get. You also get to pay an assload more.