If your lawn feels spongy underfoot or you can see a lot of dead grass and organic matter on the soil surface then the chances are you have too much thatch. As you would expect thatch acts very much like a thatched roof: it makes it harder for water to penetrate the soil and its build up is the ideal place to harbour moss and disease.
A recommended scarify once or sometimes twice a year opens up the soil surface and allows air and water penetration and removes a large percentage of the unwanted thatch. If your lawn has not been touched for years, build up in thatch can be as much as 50-75mm. The thatch layer is useful if it is thin, thin enough to let gravity take water and air through but also to prevent too much evaporation of water from the soil in very sunny weather.
Traditionally thatch has been removed from lawns in spring and autumn. It is quite an invasive operation and so the grass needs time, warmth, and water to recover fully. However, if your lawn is irrigated or we experience particularly wet weather during the summer months, this extends the period that scarifying can be carried out.