I believe that Curtin's approach to admission and rural medicine should allow it to be established, however, the government really needs to step in a regulate the market (the universities) given that the CSP places are funded by the tax payers.
This intern crisis, from what I gather, is mainly situated graduates and hospitals around the metropolitan areas. I propose that universities such as Melb, Monash, UQ, USyd, UNSW, UAdel, UWA and other major universities in largely populated areas should have small cutbacks individually, so that the sum of the total is a reduced graduate output for Australia. I realize this is somewhat discriminatory, and would need some hard data to support such a segregation of medical schools into 'cut-backs' and 'non cut-backs' but it does seem like a viable alternative from my somewhat-informed perspective.