Think of it like this: you have direct reports who are awful at their jobs. You have no idea who hired these people; you just inherited them from their sociopath ex-manager (now promoted, per the Peter Principle) who hired them for bad reasons. However, the job is a very technically-complex job, where everyone is going to be awful at any new task for the first ~6 months of doing it. Just coming into this situation, you don't really know whether these people are not-good, or just not-good yet. You have a suspicion, but you don't want to air it, because you might be wrong — they might be trying and it might just be too early to see results yet — and there's no internal corporate zeitgeist of purging deadwood to give you any confidence in avoiding backlash if you are wrong.

Later, that zeitgeist comes, and your boss's boss's boss asks your boss's boss, who asks you, to have the hard conversation with those direct reports you've been suspecting — and with their peers — to find out if they're actually making any progress in learning what's required to become productive, or whether they've just been bullshitting you. So you have that conversation, find out the ugly truth, and report it.