plpgsql: another new reserved word

I stumbled on another gotcha in 8.3's plpgsql:

create or replace function foobar() returns text as $$
declare
foobar text;
begin return 'ok'; end;
$$ language plpgsql;

Results in error:

ERROR: syntax error at or near "foobar"
LINE 3: foobar text;
^

If this is intentional, then could the error message be made better?

--
marko