Gerry. Sounds like the most amateurish and complicated way of keeping aircraft apart.
In the USA the IFR aircraft would have been in class E and could have simply requested a vector away from the VFR aircraft.
Of course not possible in Aus as both aircraft were in un- controlled airspace.
As I said - amateurish - but CASA will resist any update to class E as per the Government NAS policy - because we have always had class G ! Minds set in concrete.