I found a thread on Reddit where many people have the same problem, although they refer only to typing on the keyboard. I have the same issue when I type on the keyboard. It is not only the lag when I dictate.

Reddit

I wiped the iPad and set it up as a new device. Dictation was good for the first two times but now it is slow again. It is only the case for other languages than English (e.g. German and French). It seems to be a bug in iPad OS 17.

No, it is just incredibly slow. I am going to reset the iPad and set it up as a fresh device in a few days. I need the dictation function very often and the current situation is unbearable.

I also experience a slight lag while typing on my iPhone. It was definitely smoother before the upgrade. Dictation is normal on the iPhone, though. When I switch to English everything is fine. I guess it has something to do with the new auto correction, although this is said not to be active for German, yet. The voice dictation lag is also there for French. Only English is quick and smooth.

As I wrote, I don‘t have the issue on my iPhone but on my iPad.

The speed is okay on my iPhone 12 but not on my iPad. I have just experienced that it is faster when I dictate in English. My mother tongue is German, though. If I switch the keyboard back to German the dictation speed is dead slow. It lags behind four or five sentences even when I speak slowly.