Actually I did think about that line before posting.
Any surplus votes from elected candidates (votes in excess of the quota they need), are transferred to the candidates who were the second choice of voters on those ballot papers
My thoughts were that if you don't show a second preference then how could your vote be transferred so double checked with Antony Green blog after posting.
Quote Green:
Do not be confused with 'just vote 1' strategies used at single member electorate contests in NSW and Queensland. In the Senate the most effective vote always has preferences, even if you are voting for one of the major parties. If you only vote '1', and your party has a surplus beyond the number of elected candidates, then your vote would 'exhaust' and play no part in determining which of the remaining candidates and parties win the final vacancies to be filled.
