Historically the term had a more specific meaning: it was a description of the way in which rail companies had a habit of only introducing new stock for premier express services, and then using the supplanted older stock for second-line services, and eventually sending them to the bottom of the hierarchy for local services as even newer stock was introduced.
British Rail had an established cascade policy: for instance the introduction of electric stock to the ECML allowed diesel HSTs to be cascaded to Midlands and Cross Country, allowing the displaced loco-hauled stock to be used on secondary routes..........
However this all changed with sectorisation: a change in policy meant new stock was purchased for secondary services, so rendering much of what would otherwise have been cascaded as useless. Each sector was able to acquire its own new stock and was no longer reliant on cascaded hand-me-downs.
That cascade concept of aging stock being handed down to lower priority services no longer really applies: until recently stock tends to stay on the general kind of service for which it was introduced. However there are exceptions, notably the current downgrading of the HST units to short sets for local work. Interestingly that downgrade was part of the original BR 1970's cascade plan: the intention had been that as electrification made them redundant, the HSTs would have been reduced to 4+1 sets for secondary lines such as Waterloo-Exeter, Portsmouth-Cardiff, TransPennine