@WBYeats,
This is a unique circumstance. Whitehall Palace was originally a complex of buildings--more like a small town--then on the outskirts of London (and it was originally called White Hall Palace). You would no more use a definite article with that than you would with London, or Lambeth or Hampstead. The road which lead from the environs of the palace to the City of London (what is now the financial district of London, and a separate borough) came to be called Whitehall Road, or just Whitehall.
However, although much of the palace was burned down, the city was growing outward and soon swallowed up that district, while government offices were set up in the new Queen Anne style (English Baroque), and then the several architectural styles which were popular in the Georgian era (roughly, 1715 to 1830) most notably English Rococo and Neo-classical. When it comes to things like that, the English never throw anything away. Government offices have continued to be housed in those buildings, despite the maintenance costs, to such an extent that Whitehall has become synonymous with government bureaucracy in England.
I cannot imagine why anyone would write "so-called" Whitehall--it's a very real noun to mean government in London. However, note the use of the plural form of "to be." This is in line with British usage, such as saying "the staff are" rather than "the staff is" as an American would probably say it. Although the definite article is not required here, i suspect it was used just as one might say "The government are . . . " or "The bureaucracies are . . . "