We, in Australia, do seem to have created a blind spot when it comes to the allocation of resources. We seem to happily provide world-class ATS services where there is a dollar to be made, but ignore the low level environment where there are no profits, but statistically the majority of accidents occur.
This was not an issue pre cost recovery because OCTA was used only by low performance aircraft. However there was an extensive network of Flight Service Units providing what are now known as Class F airspace services. In effect the Government provided an OCTA safety system, down to the surface, that was appropriate to the aircraft types operating.
After cost recovery this Class F system was dismantled and should have been replaced where IFR, and/or passenger services flew, with Class E/D/C services utilising radar where available. Class G would have filled in the blanks.
The Government, for whatever reason, chose not to let this happen, so what is left is a massive investment unbalance. Money is spent on en-route surveillance and control, where the Government through Airservices charges by weight and NM flown, and recieves a handsome dividend every year. Conversely there is an almost complete lack of investment in low level safety except for the existing, and now obselescently equipped, Class D towers, all of which lose money and detract from the handsome dividend. In this environment even what should be a required reaction from Airservices to traffic changes appears to have ceased. ie. Towers that should be closed are still open, and airports that should have towers are ignored.
What we are arguably left with is in some areas an OCTA (Class G) system that is no longer appropriate to the types of aircraft operating, exacerbated by a controlled airspace system imposed down to low levels, apparently without due regard for is happening underneath. eg Proserpine
Our replacement for what was an excellent though expensive Government provided Class F airspace system, is now a very cheap pilot operated Class G system.
Perhaps the international PPruners can help here because I believe that the Governments of the US and Britain still provide a low level safety system. In Britain there is a low level radar service, and instrument approaches are protected by control towers (For airline ops). In the US Class E airspace is provided down to instrument approach minimas for all IFR operations. Radar is used where it exists but I don't believe it is a pre-requisite for any type of operation. What the pilots do have in both environments is the assistance of ATC both in the provision of information and separation.
The question posed by this thread is whether an all-weather pilot organised separation service in Class G airspace without the assistance of ATC is safe or unsafe given Australia's traffic levels and mix? The answer is probably "it depends", but then that is why the cocktail of airspace classes and associated air and ground based tools has been developed. Personally I don't think we use them very intelligently. There is far too much opinion and far too little objective rule based planning.