Timemachine full

"The machine could not complete the backup....requires XXXGb....but only YYYYGb are available."

Background:

Have a MBP with 1Tb SSD. It was time machines to auto backup to a 2Tb USB drive and a 2Tb Disk caddy drive. Never filled up, I assume the old backups were deleted when the new backups were ready.

Now:

Have iMac with 2Tb SSD. TimeMachine has 3 x 2Tb and 1 x 3Tb Caddy drives (ie. 9Tb backup space).

Now my understanding was that Timemachine should remove older backups for each new backup. Yet I am continually getting the 2 Tb drives failing because of a lack of disk space. This is annoying, frustrating and dangerous if auto backups are not being carries out.

Of course I understand if 400Gb is required and 300Gb is available then the backup will fail, why doesn't the system get rid of old files.

I can only think the actual full backup plus any incremental backup is greater than 2Tb. If this is the case it implies that only a single full backup can be carried out on the system. This 'may' be because one VM (PVM File) is 350Gb and Timemachine backs up the complete VM.

So what am I doing wrong and/or how can I correct this behaviour?

Thanks

Kevin