I think the best thing for me now is to plant something shrubby (preferably small), or a ground cover that's not too vigorous/invasive. It should also be easy to care for, hardy to ACT's weather. This also sounds like a favourable alternative to mulching the whole area :)

I would love to know of which native plants may suit this area, preferably something flowering and bird attracting? I've been recommended grevillea bronze rambler by the nursery...how does this sound? I currently have plants like hardenbergia violacea and grevillea lanigera which I like in the sense that weeds don't grow under them, are low in height and don't spread too unruly, and they're very pretty when they flower :) Any others that might suit my requirements?

If it is a strip against the fence, then would you be able to grow something narrow? Or even a climber against the fence?

I agree with wazcrazy though - try and by somethng a bit different. You could even plant a group of low growing plants together - such as correas and croweas. I have a prostrate correa alba - which is very pretty. Also, runny postman (kennedia prostrata) is a very effective groundcover.

There are some nice eremophila (dubius?, glabra protrate), wattle and grevillea (nudiflora) ground covers around. There are several goodeniacea ground covers (there's dark leaved goodenia ovata, goodenia hedracea, scavolas and if you're lucky, several nice lechenaultias). Another source of ground covers is the brachycombs - You can pick almost any colour you like, apart from red. These are really tough in sandy soil.

If you want to try propagating stuff yourself, a classic way of producing ground covers is to grow cuttings from low side shoots, repeat this process a few times and often you will get a ground cover.

I found the following information:
http://www.environment.act.gov.au/yourenvironmenthwp/groundcovers.html
Don't know if they're native plants, but if it's recommended there, I might look around for some of them to add colour/variety. Does anyone have good experience with any of these groundcovers here?

I have a large garden bed, but don't feel like purchasing large quantities of mulch each time. It's time to sort the place out now that it's spring :)

I've never had much luck with scleranthus, neither in Canberra nor Melbourne. It seems to died from under watering and over watering too easily.

Investigate your council tip and see if they have big piles of old chipped garden waste. As long as it is dark brown and doesn't have any obvious weeds growing in it,it should be find to use as a soil conditioner. You can probably pay someone to deliver a truckload of the stuff for a tuppence and spread that out.

Avoid fresh mulches like woodchip or pine bark, as they are loaded with tannins which stunt growth, and pull the nitrogen out of the soil. Another possible mulch is road metal, which is cheap, readily available and looks quite interesting (to me, anyway). You can usually get blue metal (a kind of basalt) or granite. Canberra should also still sell 'granitic sand', a form of decomposed granite which makes a dense layer (though often contains a fair amount of clay).

Start saving those newspapers!

I also found http://nativeplants-canberra.asn.au/articles/article07.htm which looks like a good place to start :)

It is easier, quicker, cheaper and safer to do a bulk mulching before you start - particularly if you let it settle in for a year before planting.

What is road metal mulch like? Is it made out of metal?

Thanks for the replies so far, they've been so helpful. I agree that I should get the mulch sorted first (the canvas ready before planting somewhat :)). I'll also keep the blood and bone idea in mind...do I need to put it in areas where I do not expect to plant plants? I didn't realise it smothers weeds :)

Road metal is just a general term for crushed hard rocks suitable for coating roads with.

it is crushed up rocks, in wa at least it's usually sold as blue metal, and is small granite rocks

"I'll also keep the blood and bone idea in mind...do I need to put it in areas where I do not expect to plant plants? I didn't realise it smothers weeds :)"

no dont put blood and bone around where youre not planting, it will just feed the weeds. blood and bone doesnt smother weeds, the mulch and newspaper will, and the blood and bone adds some nutrients to the area.