CLOSE TO €10 billion has been wiped off Irish pension funds in the first three months of 2008, according to figures published last night.

All group-managed pension fund managers in the Irish market lost money in March for the fifth month in a row. The average Irish fund lost 3.8 per cent last month and has now reported losses of 11.4 per cent for the first quarter of the year, the figures from Rubicon Investment Consulting show.

The growing losses mean that only one fund manager, Oppenheim, has outperformed inflation over the past 10 years. The average Irish fund has grown by just 3.2 per cent per year over the past decade. Over the same period, inflation has run at an average of 3.8 per cent.

Although recent setbacks have eaten into Oppenheim's long-term performance, it has still recorded gains of 5 per cent on average for each of the past 10 years. Oppenheim was recently acquired by Merrion Capital.

Although the pensions industry correctly dismisses short-term blips by pointing to the long-term nature of pension fund investment, the negative real return over the 10-year time-frame will be a cause for concern, especially as the Government examines the prospect of mandatory pensions for employees.

Raymond Bourke, of benefit consultants Hewitt Associates, said the fall in the first quarter of 2008 was the worst in over five years.

Mr Hewitt noted global equities have fallen 16.1 per cent this year, with losses on Irish shares a less dramatic 10 per cent. Property, a significant pension fund investment, has also struggled for gains.