MARK COLVIN: The implications of Volkswagen's global exhaust emissions deception are still unfolding in Australia.
The company has admitted that it fitted software into 11 million diesel cars worldwide to bypass pollution tests.
Australia's Greens leader says it's a serious breach and the Government needs to do more to address fuel efficiency.
The Deputy Prime Minister has indicated that any changes to design rules would have serious implications for car-makers in Australia.
From Melbourne Stephanie Corsetti reports
STEPHANIE CORSETTI: It's peak hour in Melbourne and drivers are crawling through the city. But these motorists are still in the dark about whether there's been exposure to diesel pollution at levels higher than first thought from Volkswagen vehicles in Australia.
The World Health Organisation confirmed back in 2012 that diesel engine exhaust fumes can cause cancer.
The revelations that millions of Volkswagen's diesel cars are equipped with devices that can cheat pollution tests has sparked public outrage and the resignation of the company's chief executive.
Maurice Blackburn lawyers are exploring potential consumer action against the company, depending on how Australian car owners have been affected.
But the Climate and Health Alliance's president Dr Liz Hanna insists the public has been put at risk.
LIZ HANNA: We are very distressed with the behaviour of Volkswagen, particularly when you consider the number of vehicles that are produced and are on sale around the world and in flouting the standards, which is only motivated by greed, is actually holding people's health to ransom.
STEPHANIE CORSETTI: The Greens leader says it's a serious breach and Australians could be at greater risk because of what he says are weak emission regulations.
Senator Richard Di Natale hopes the scandal will encourage leaders to raise standards so they match Europe.
RICHARD DI NATALE: Here's an opportunity for us to recognise that the rest of the world is taking strong action when it comes to improving their air quality and Australia is lagging behind.
STEPHANIE CORSETTI: The Greens have also criticised the Federal Government's clean air agreement, because it doesn't adequately address diesel pollution.
Phil Hill from Environmental Justice Australia is also worried the draft plan will not boost legal protection.
PHIL HILL: All indications are that agreement is not going to be effective and we'd call on Minister Hunt and the Ministers from each state and territory to really listen to the community.
STEPHANIE CORSETTI: The Deputy Prime Minister Warren Truss has told tonight's 7.30 program the situation could result in vehicle recalls.
WARREN TRUSS: So the issue is serious, it's a separate issue in relation to Australia's vehicle design laws and obviously we are in the process of modernising those at the present time and that will take into account that the international standards that apply in countries like Europe and Japan and of course the United States.
STEPHANIE CORSETTI: The Clean Air Agreement has flagged a review of Australia's fuel quality standards legislation as a possibility.
That deal will be finalised before the end of the year.
MARK COLVIN: Stephanie Corsetti reporting, and there will be more on this developing story on 7.30 tonight on ABC TV.