I'm sure someone over there with the books in front of them will set you straight, but in the mean time........did you know the ATSB had done an investigation?
Information obtained from the crews of both aircraft, the Airservices ATS controller, recorded flight data from the B737, ATS audio recordings and radar data, is consistent and indicates that the crews of both aircraft and the ATS controller complied with the published procedures for Class E airspace under NAS 2b.
So the ATSB seems to think everyone followed the published procedures.
Your quote
MATS 4.1.1.1 Nothing in this chapter precludes a controller from using discretion and initiative in any particular circumstance where these procedures appear to be in conflict with the requirement to promote the safe conduct of flight.
Implies you think this paragraph is relevent ie. you think the procedures don't promote safe flight? Correct? And yet you don't think the procedures might be flawed?