Conservative former leader Sir Iain Duncan Smith blamed Spain for the delay, saying it was a case of "manana, manana" and saying it was "time they do what they agreed".
As of last Sunday, UK nationals who have lived in Spain for more than six months will no longer be able to use their UK driving licences. British residents will need to obtain a Spanish licence and may need to retake a driving test until an agreement is reached.
The Foreign Office said it was pushing to "accelerate talks" with the Spanish government.
The source said: "This could go on for a week or it could be longer. It should be temporary but we don't know how temporary."
A Foreign Office spokesperson said: "Despite the UK Government's best efforts, an agreement to swap UK driving licences for Spanish licences has not yet been reached. From May 1, UK licence holders who have been resident in Spain for more than six months and did not exchange their licence during the transition period will no longer be able to drive legally in Spain.
"This does not affect visiting or tourist motorists from the UK or Gibraltar. We have agreed to rapidly accelerate talks and are urging the Spanish government to bring forward interim measures.
"We remain committed to reaching a deal and the UK already has similar arrangements in place with 24 other EU countries."
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Maybe I've understood this wrong. But it seems that the Spanish government are not offering any method for new residents in Spain from the UK to transfer their existing UK licence to a Spanish driving licence, and at the same time won't allow the UK driving licence to be used. This is not normal surely? I think almost all other EU countries allow for a simple exchange of a valid UK licence to the countries licence (for licences issued before 2021). This is reciprocated in the UK.
I thought not. Yet Brits want Spain to permit them to use a British driving licence when resident in Spain? Isn't that rather "double standard"? Or are Brits simply "entitled" by accident of birth?
The headlines are a bit misleading. UK licences are perfectly valid in Spain. For tourists, tenting a car for example. The begging question is... If say, a Spanish (or any other) national, legally resident in the UK refuses to get a UK driving licence, it's perfectly ok to use whatever they have, right? Forever?