Thermal insulation is a fundamental factor to achieve thermal comfort for occupants. Insulation reduces undesirable heat loss or gain and can lower the energy demand of heating and cooling systems.
The ability of insulation is evaluated by its R-value. The higher the R-value the better the performance.
Nevertheless, an R-value does not consider the quality of the construction, the application of the insulation or local environmental factors for a building. The building codes specify requirements for every climate zone, it is important to keep in mind these are bare minimums only and not best practice and are not sufficient if you want to build an energy efficient home.
Insulation needs to be installed with careful attention to detail, as inappropriate or incorrect application will crucially decrease performance. For instance, failure to butt all ends and edges of batts to give a snug fit could mean that about 5% of the ceiling area is not being covered. This could result in losing up to 50% of the potential insulation benefits.
As a rough guide for the Melbourne climate, I would recommend R6.0 insulation for a ceiling/roof. R2.5 at least for a wall. R2.5 under a suspended timer floor and R1.0 under a concrete slab.