Time Machine is supposed to delete the oldest backups when the disk is full.
Why do I get the message that Backup failed because the disk is full?
iMac, macOS 10.12
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The following is from Apple's website support page:
The oldest backups are deleted when your backup disk is full.
So. It still hast to maintain at least one copy of whatever is on your Mac, regardless if it is old or not. It won't delete a backup of a file that is the only backup of the file if it still exists on your Mac.
Time Machine doesn't make copies of files that haven't changed. It just creates a hard link (file reference) which doesn't take up space. There aren't a bunch of copies of the data on the disk. There is only one for each version of a file. Once it pares down to that one storage location, it can't delete any more.