"The issue was discussed, and the view followed by the national security commission calls for a downgrading of relations with the country (Britain) to the level of charge d'affaires", Mehdi Sanai told the state-run Fars news agency on Sunday.
A group of British MPs and peers, headed by Labour peer Lord Corbett of Castle Vale, last week called on the British government to implement a firm policy towards Iran with calls for an end to trade with Iran.
The current clash between the two nations follows widespread protests throughout Iran on the Shiite holy day of Ashura in which Iranian demonstrators demanded an end to the rule of Supreme Leader Ayatollah Ali Khamenei, commanding in its place a democratic government. Iran has accused Britain of direct involvement in these protests. London denies the charge.