Circumstances The Canberra air traffic control approach and departures functions were being performed by one controller because of the low traffic density. VH-ILL departed Canberra for the local training areas and intended to transit at 4,000 feet which was the normal altitude for such transit. The approach/departures controller had a flight progress strip and notated this altitude on the strip in the normal manner. The pilot of VH-ILL then requested a climb to 5,000 feet which was approved as there was no conflicting traffic. The flight progress strip was annotated correctly with this change. At this time air traffic levels were increasing and it was decided to separate the approach and departures functions. During this transition, control of VH-ILL was taken over by the oncoming departures controller who was given the flight progress strip. The approach controller then replaced this conflict alert tool with another, a red plastic rectangle referred to as a "shrimp boat", which was placed on the radar screen to indicate that there was traffic en route to the training areas. However the controller did not notate an altitude on this shrimp boat. VH-TAH was arriving at Canberra from Sydney and the approach controller was radar vectoring that aircraft for an approach to runway 35. During this vectoring process the controller descended VH-TAH to 5,000 feet without providing horizontal separation with VH-ILL. The radar screens at Canberra do not show Secondary Surveillance Radar [SSR] Mode C altitude readout, and the controller evidently forgot the height of VH-ILL. The aircraft came within half a nautical mile and 300 feet of each other. The required separation standard is five nautical miles or 1,000 feet. Significant Factors 1.The approach controller gave up his main conflict alert reminder when he passed the flight progress strip to the oncoming departures controller. 2.The approach controller did not notate the altitude assigned to VH-ILL on the red shrimp boat. 3.SSR Mode C altitude information is not available at Canberra. Safety Action Deficiencies were identified during this investigation and appropriate safety recommendations are being formulated.