I can see the concrete blocks inside the house through the paintwork
There's nothing wrong with simply leaving the cinder block surface and painting it.   It will look like painted cinder blocks.  

It has a few advantages, it's tough, easier to clean, and much, much, much, much easier to clean up after a flood. 

Covering that up with plaster or drywall is just a matter of aesthetics.  It's not like it's bad architecture, it's just a different design choice (of course the hooty-tooty crowd consider it more lowbrow, but whatever.) 

If someone aimed to do that, and missed, then yeah, that's bad work.