I always thought it was based on social readiness. I know Vic used to be from 1st july-30th june so kids starting school would be anywhere from 4.5-5.5 when they started but cut it back 2 months because younger ones were struggling. I have also heard it more becomes an issue around grade 2 when you notice problems and at that stage you don't want to hold kids back.
Back when I went to school you just went where your birthday fell unless special circumstances but now it seems alot parents are making the choice themselves for kids born Feb to April, keeping them back at kinder extra year so they'd be just about turning 6 when prep starts. I find this more with boys than girls.