Margaret Thatcher branded the European Commission’s plans for a single currency as a rush of blood to the head.

The British Prime Minister hit out at the “politburo” in Brussels and vowed not to be dictated to, during talks with her Irish counterpart.

The Tory Eurosceptic likened giving away powers of taxation to gifting sovereignty to Europe, Dublin archives from 1990 show.

The Irish Government note recorded that Mrs Thatcher said: “In talking of a single currency, Delors must have had a rush of blood to the head.

“We are not going to have a single currency.”

Jacques Delors was European Commission president at the time and an advocate of deeper integration.

The Tory leader was engaged in discussions with Irish Taoiseach Charles Haughey in June 1990, State files showed.

She wanted to turn the Commission into a professional civil service, without the power of initiative, whose job would be to service the Council of Ministers which represents national governments in Europe.

She told Mr Haughey that cultural differences between member states over the internal market in goods would remain.

“The Italians will continue not to pay taxes.”

She accused the European Court of giving more powers to the Commission.

“The days of appointed commissioners must be numbered.

“We must give power to the Council of Ministers.

“I am not handing over authority to a non-elected bureaucracy.”

Mr Haughey said the Commission was contacting Irish local authorities and inviting groups over to Brussels.

“They are going behind the back of the Government.”

Mrs Thatcher said the deciding body must be the Council of Ministers.

“We must take away the power of initiative of the Commission.

“I am getting completely fed up with the European Community trying to tie us up with bureaucratic regulations.”

At the time, Soviet Union control over eastern Europe was collapsing.

Mrs Thatcher added: “We are trying to get Eastern Europe to accept democratic standards and here we are recreating our own politburo.

“They are just too much.”

She said she would not accept a central bank of the 12 EU member states and wanted to keep inflation down by allying with the deutschmark.

She noted Germany had experience of inflation – hyper inflation prompted by printing of paper money heralded the rise of Nazism – and kept its currency like a gold standard, where cash had a value directly linked to that of the precious metal.

Mrs Thatcher said the central bank of the 12 would not have the same will to fight inflation as the Germans had.

“They would think of economic growth and jobs and inflation as equal objectives and mix them all up.

“All we want is an effective gold standard and the deutschmark provides us with that.”

The newly published papers are contained in National Archives file reference number 2020/17/31.