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Five minutes with Peter Hughes, Prime Super Regional Manager for Western Victoria

Q: You have an extensive background in business development, sales management and investment and strategic advice both in Australia and the UK. Tell us about your professional career to date. How did you get into the superannuation game?

After an early career in real estate sales and management, I travelled to the UK for the 1999 Rugby World Cup and decided to stay a while. I worked as a National Business Development Manager for a property portal during the dotcom boom and then as the London Regional Manager for The Credit Protection Association, which was my formal introduction to financial services.

After returning to Australia in 2003, I was hired by Rural Funds Management (RFM) as their State Manager, Business Development for NSW and the following year was fortunate enough to meet my future wife.

One of my key responsibilities was to run training seminars for financial planners and dealer groups on technical areas such as portfolio theory (how adding a new asset class to a mix of assets affects the risk and return of the whole portfolio). As my relationships deepened, it became clear that advisers were hungry for more advice and information on industry best practice models in dealing with their clients’ superannuation accounts than I was then qualified to provide, so I began investigating tertiary opportunities.

2008 saw the birth of our first child and in 2009 after what had been a fabulous six years with RFM, I took the opportunity to be a stay-at-home dad for three years while completing a Master of Financial Planning. In that time, we also welcomed our second child.

With two young children and no family in Sydney, we were ready to make a move. When the opportunity arose to take up a Senior Financial Planning position in Ballarat I jumped at the chance. This gave me the 360° view of the superannuation industry and put us in proximity to my wife’s family in Melbourne, while enjoying the considerable benefits of a regional lifestyle.

The position at Prime Super came along last year and it ticked all the boxes. It was Ballarat based, drew on my previous experience and qualifications and was with a very well respected and independent superannuation institution.

Q: We are now several months into the COVID-19 crisis and there are signs life is starting to return to normal. There were fears the virus would decimate superannuation funds – what has been the reality?

The fear was that superannuation funds may not have enough assets in cash to meet member claims under the government $10,000 COVID-19 Early Release of Super initiative.

Further, it was mooted that some of these funds could be forced to sell assets in a falling market and therefore would need to sell more assets than normal due to reduced valuations.

Prime Super is a relatively conservative institution and we were not challenged in meeting these redemptions. Indeed, even those super funds that were thought to be more at risk due to higher likely claims and/or more illiquid assets have all been able to comfortably meet the claims of their members.

Although there have been strong opinions about whether the Early Release program was good or bad, at Prime Super we took the view that once the decision had been made, we should make every effort to get the money to members as efficiently and quickly as possible.

Q: The questions being asked by members has likely evolved as the impact of the virus has. What is the main piece of advice you are offering them now?

The main message would have to be that, despite the devastating consequences for individuals, families, communities and the economy, members do not need to be overly concerned about the value and security of their retirement nest egg. Prime Super has performed very well in the good times and particularly well in this recent difficult period relative to our peers.

The vast majority of our members are invested in our default “MySuper” diversified option.

Being a conservative organisation, we have less share market exposure and more property and alternative assets such as wind farms and recycling plants in Scandinavian countries for example. These have long term contracts which deliver a regular income - ideal for these times.

Our MySuper investment option returned top quartile performance to members with 9.21% over a three-year period, 8.53% over five years and 10.07% over seven7 years.^ # And despite the recent volatility, we are down less than 1% for the financial year to date.

Most super funds in Australia have a “MySuper” default fund and Prime Super’s MySuper Investment Option was just ranked No.3 for risk adjusted performance against our peers. # *

Super is a long-term investment, so our other main advice is for members is to consider their personal circumstances and not to try to switch investment options to match market conditions. The share market dropped over 30% in March and has made most of that back since. If a member got out at the bottom and was sitting in cash now, when would they ever go back? The experts can’t pick it so safer to just keep making regular contributions over the long term.

^ SuperRatings Fund Crediting Rate Survey – Balanced (60-76), June 2019

# Past performance is not a reliable indicator of future performance

* Rainmaker Information Pty Ltd March 2020MySuper investment performance and risk metrics

Q: How do you see the superannuation world after Coronavirus?

I don’t see too much change, however I think people will be a little more financially conservative with their finances both inside and out of super. We have all had a good hard look at what a rainy day can look like. We have seen strong economies quickly change to broadscale unemployment with almost no warning.

For many, this has served as a reminder to keep some cash aside to allow for the unexpected disruption to our lives that happens from time to time. And this is a good time for members of all super funds to talk to their fund about how much they will need in retirement and what they need to do to achieve those financial reserves.

Q: What do you love about your job?

Superannuation is a great industry and the Australian model is unique. It’s a noble cause to

help Australians save for their retirement and I’m sure that all superannuation industry workers feel that they are really making a worthwhile contribution.

Prime Super is the only super fund in Australia that is entirely owned by the membership, so when we say that profits go to members, we literally mean it. With $5 billion and assets and 130,000 members, we are not a small fund but also not so large as to lose that personal contact with members. We have Regional Manager like me throughout Australia.

We just keep delivering returns that are amongst the best in the industry with competitive fees as discussed earlier. For me, job satisfaction is strongly linked to the conviction that I am working for the good guys! It is such a pleasure and privilege when members put so much trust in their super fund.

Talking to members about their financial future is always an uplifting experience as members are often setting life-long goals and having to project to a time when their young children may have their own kids. Every day, I help new members join while retiring members convert their super to a pension income stream – it is the circle of life in real time.

Q: Why do you enjoy working with RCSA and our member base?

I find recruitment consultants to be generally energetic, upbeat and self-directed people and that tends to permeate the industry. There is a common saying that the best form of charity is to give somebody a job. Placing people into employment is good for the candidate, the employer, the country and the consultant – what more could one want in terms of job satisfaction!

Indeed, my employment with Prime Super was a direct consequence of the proactive diligence of one such recruitment consultant. Ana Sousa, who has since moved overseas, was working at Randstad Melbourne when she contacted me out of the blue via LinkedIn to say she thought she had the ideal position for me. At that time, I had been verbally offered a position with a government owned financial organisation while they were resolving an internal delay in formalising the offer.

The position with Prime did indeed look like a great fit and Ana arranged for an immediate interview, then second interview just in time such that the formal offer from Prime Super and the other employer came almost simultaneously. And the rest is history as they say!

Q: Tell us about Peter Hughes away from work. Your family, hobbies etc?

I am married with two boys, aged 11 and eight. Much of the weekend is taken up with kid’s sport and I love it. We are all looking forward to footy and basketball kicking off again no matter how wet and cold it gets.

I love camping and exploring the Australian landscape. I really missed getting together with family and friends at Easter this year. We are raring to go when the next opportunity arises.

My oldest boy and I support the Brumbies in rugby union and the Swans in AFL, while my wife and youngest are Hawks fans. During this lockdown, we made a bucket list plan to visit every AFL ground in the country over the next few years when Swans are playing (well half of us are keen).

I have a large family centred mostly around Canberra and we are looking forward to our first visit in a while during the September school holidays.

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