No, the problem is that the number of HD's given out is capped at 4% of the students in the course. The same goes for D's and C's, with the former being around 12-17% if I recall correctly. From what I hear, (which is probably slightly exaggerated) you can get raw marks in the 80's or 90's and then get scaled down to a distinction/credit.
So out of say 400 kids, only 16 end up getting HD's. Considering the majority of the candidature is scrambling to get accepted into medicine/dentistry, everybody works hard and the mark distributions are pretty unforgiving.