The subject has been brought up a number of times over the last decade and at the end of the day CASA nor the industry have had the guts to make a decision on it. There is nothing wrong with have instructors with only basic time, PROVIDED that they are supervised and the product they are teaching is monitored and also checked - not as a check on the student, but on the instructor.
The sad part has already been said in the previous posts and the system now has CFI's who started out that way. These people I am sorry to say don't know what they don't know and the end result is a trainee pilot that is nowhere as good as they were in days gone by. A pilot passing a CPL test today would not have passed a PPL in the early '80's. The standard has come down that much...! What is causing that you may well ask? Well commercial pressure is one reason and the number of flying schools is another. Of course CASA has a role in this, but because of the commercial pressure even the results of a instructor review held in the mid '90's was put to one side. Very sad.
I see the products and many have to been taught almost over again. The leaning cake is only so big and with many new subjects some of the old ones just seem to be not there any more. There is very little understanding of power and speed control and the use of rudder in x/w operations. Many pilots are taught there is safety in speed on approach and then they wonder why it takes up so much runway to land ! Airmanship fell off the learning truck in many schools some years back and we wonder why the standards are falling... Certainly the self disipline that was there has gone in many cases.
I could go on, but in answer to the question, I believe that prospetive instructors should have 500- 700 hours minimum, the only exception being those that operate in an environment where there is very high levels of supervision.
Flying training is the worst it has been for many years and it will only get better if the training gets better and at the moment it is just getting worse!