A more official description of the Aus alpha-numeric scheme is here -http://www.vicroads.vic.gov.au/Home/Mor ... rSigns.htm
(apologies for the long URL - my first post, and I don't know yet how to make the smaller link).
That web site is at VicRoads, the road management authority for Victoria, but it is representative of the nationwide program.
The M-A-B-C prefix system is clearly influenced by the UK's. This is especially obvious from the usage of prefix 'M' for limited access dual carriageways, since 'freeway' is the common term in Australia rather than 'motorway'.
One major improvement over the UK system is that the prefix may change along a single route, but the route retains its number throughout its length. For example, the route from Melbourne to Philip island (a tourist destination) begins as M420, degrading later to A420, and (on the island) becoming B420. I think this is a really good feature. It avoids the UK situation of having an M5 and an A5 that bear no relation to each other, and the situation of having an M1 and an A1 and multiple pieces of A1(M).
The numbers are derived from a zone system, slightly UK-like. Each state has its own system, so duplicate numbers may exist, but they are unique within a given state. For roads that cross state borders there is continuity, and close to borders there are no duplicates. This is managed through coordination between state roads authorities. It is a pity the scheme does not enforce national uniqueness, but Australia unfortunately has a record of being inexpert at that sort of national cooperation.
My main criticism of the system is that the prefix tries to indicate both route function and build quality. For example Vicroads states: "'M' roads provide a consistent high standard of driving conditions, with divided carriageways, four traffic lanes, sealed shoulders and line marking that is easily visible in all weather conditions. 'M' roads are the primary road links connecting Melbourne and other capital cities and major provincial centres. Examples of 'M' roads are the Princes Freeway (M1) and the Hume Freeway (M31)."
The problem is that a route obviously has one function along its length, but its standard may vary. I believe that the prefix (and perhaps it should be a suffix, since the number is the more important component) should strictly represent the build quality. The example referred to previously (M420/A420/B420) does this already, but many routes don't.
Route function or importance could then be indicated by more consistent variation in the number of digits. This practise is already included in the systems, but its emphasis varies: Tasmania's usage is strict and obvious, Victoria's slightly less so. In practise I don't think this is important: a motorist travelling from point A to point B doesn't care whether some long-gone road numberer considered this motorist's origin and destination to be "primary". Both are important to this journey, and the motorist will select his route according to directness, build-quality, safety, etc, not by 'route function'.
In South Australia there is a 'D' prefix in addition to the standard M-A-B-C, indicating a C-type route that does not have a sealed surface, ie it's dirt, gravel, etc.
Implementation of alpha-numeric numbering is complete in Tasmania, complete in Victoria rural (Melbourne metropolitan is deferred), and hardly begun in WA. Other states are in-between.