Yes, vehicle speedo's can (and indeed must) be out by a factor. I know it used to be 10% years ago but that might have changed. As others have said, the tolerance is always negative, i.e. your actual speed should always be less than equal to the speed shown on the dash. That's not an Australian rule. As far as I know it's a global rule, or at least it's been that way in Europe for decades as well.
Part of the reason is that it is also impossible for any speedo that is not measured via GPS to be accurate for long periods of time. If the speed is measured by the revolutions of the car wheel then the speed shown on the dash will be be dependent upon tyre wear. A new set of decent AT tyres will will have 14-15mm of tread depth. Just say for sake of argument you run them until they have 3mm of tread left. That's 12mm of tread less, or roughly 0.5" difference in the radius of they tyre. That is equivalent of a changing from a 33" tyre to a 32" tyre, or around 3% difference. As the tyre wears the wheel effectively gets smaller but the axle speed (governed by the engine speed and gearing) will remain the same. Your actual road speed will therefore get less and less as the tyre wears but your speedo will still be reading the same amount if it is driven by wheel/axle rotations. The 10% variance in speedo accuracy has to cover this tolerance as well.