I think it is clear that the CASA OAR should be primarily responsible for failing to declare an appropriately safe class of airspace for IFR aircraft to operate in and hope that will become abundantly clear when the legal processes are all finalised (may I live so long), but
The Airservices Act 1985 at Part 2 sets out the powers and functions of AA and at:
8(3) says: "........the extent to which Airservices provides services and facilities is subject to AAs discretion."
and at
9(1) In exercising its powers and performing its functions, AA must regard the safety of Air Navigation as the most important consideration.
Just precisely how AA is intended to exercise that discretion when the determination of Airspace classes lies with OAR is not clear.
But I suspect Section 9(1) and consideration of what happened at Mangalore is key to understanding why AA is pushing this improvement in Airspace Classification.