This is explained to us in our opening sequence which is actually a pretty decently sized prologue. In this opening, someone in Information Retrieval squashes a fly on the ceiling which falls into a typewriter and turns Tuttle into Buttle. Cut to a happy family on Christmas morning, suddenly an extremely oversized squad of police puts a sack over Mr. Buttle's head and takes him away, even cutting a hole that the Department of Works can't even fix, before they leave however they make the wife sign his papers and get a receipt and pay for processing.
And this is where our main character comes in.
So our main character, Sam Lowry, lives in a pretty shitty and boring world where everything is run by bureaucracy, with some 1984 vibes; he copes with this by daydreaming about being a metal valkyrie man who saves a damsel in distress.