Why are the states balking? They don't believe in vaccines making a difference? Then why bother to roll out mass vaccinations across the country?
Opposite reasons really. NSW broadly opposes state border closures – they have only closed the border once when Victoria had its large second wave – so won't agree to a system that would mean vaccine checks at state border points. Western Australia and Queensland don't want the virus in the community at all so they want the ability to shut their states when it suits them. Until the population is vaccinated that is the status quo.
But yeah, it's essentially politics.