[This is a summary of a segment to be given on ABC 891 Radio tomorrow - Tuesday 21st at about 2:30PM]
Some great information can be found on this subject by Andrew Nemeth - NSW Photo Rights. Whilst it is targeted at NSW Laws it applies in most other states of Australia.
In summary, there are no privacy laws restricting photography in public places in Australia. Taking photographs on private property is another matter - owners of private property are well within their rights to prohibit it.
That said, they cannot force you to hand over your camera or film, or delete images.
Council Photography Permits mooted by Waverley Council and Randwick Council were never passed, or at least were recinded as they were probably unenforcable. Likewise, restrictons on photographing your own children at the school swimming carnival, plays, convers, etcetera.
Images of a sexual nature, especially those taken in places where people could reasonably expect a level of privacy are another matter - voyeurism is likely to put you in touch with the law.
All of your rights aside, it is not hard to be polite. There are no shortage of subjects, including people willing to be shot, so if you are a photographer and asked to cease and desist, it is usually the best course.
The Legal Situation is described by the Attorney General of Australia in this white paper.