Hi Norm,
That's excessive that's for sure. This really could've gone at letter rate as it's not very thick at all. That would've made it go for $2.00. I sent a small thicker than normal remote control for a Kenwood car audio system to Victoria for the mentioned figure. What I find is that some Australia Post franchises stitch you up for the most expensive way thus they get more out of it while good staff know how to send cheaper which in-turn keeps the customer happier and more return business. 
Generally though it's the former method that's implemented.
cheers,
BB.