Margaret Thatcher volunteered to buy her own ironing board and bed linen during confidential discussions about the cost of refurbishing her private apartment at No 10 Downing Street.

Correspondence between the prime minister's office and the Property Services Agency reveal that she felt unfairly impugned by questions about expenditure on ministers' accommodation.

The sum of £1,736 for fitting out Downing Street was given to parliament in answer to a question by the veteran republican Labour MP Willie Hamilton. Thatcher's office, however, had not been informed in advance of the release.

A furious exchange erupted behind the scenes. "No one here was consulted about the fact that you intended to publish this information. This must not happen again," her private secretary warned the Department of the Environment.

A full breakdown of the figure was demanded. It shows the costs in 1979 included £464 spent on replacing linen, £39 on "sewing carpet seams", £19 on an ironing board and £527 on cleaning carpets. In fact, the overall sum amounted to £1,836.

The prime minister's personal annotations are on the letter. The £123 for "repolishing furniture" is circled in blue ink. Below she scribbled: "We use only one bedroom. Can the rest go back into store. I will pay for the ironing board." She also offered to pay for "other things like sufficient linen for the one bedroom we use".

Her sense of household economy, typical of the postwar generation, caused problems for the Welsh secretary, Nicholas Edwards, when he proposed spending £26,000 on a ministerial "flatlet" in Cardiff later in 1981.

"It is a good idea," she noted in blue ink on the letter, "but not at that price. I just don't believe that a one-room and bathroom flat [conversion] can cost £26,000. Get some other estimates."

The cost was eventually slashed to £12,000 and her private office wrote to the Department of the Environment that "the prime minister was pleased to learn of the more economical arrangements which have been devised."