The Copyright, Designs and Patents Act 1988 permits the use of any copyrighted material for the purposes of examination, except printed music.
You may include quotations, images or figures in your exam question; hand out copied articles or book chapters for reference; play a sound recording or film, demonstrate a computer program.
All use must be accompanied by a sufficient acknowledgement and comply with fair dealing, i.e. the amount used must be no more than is necessary for the setting of the questions, must not negate the necessity of a commercial purchase, must not be used in a derogatory or negative manner etc.
The Copyright Act allows use for the purposes of examination only; consulting past papers is considered study or revision, and therefore the blanket exception for examination is not applicable.
However, this kind of use of exam papers for revision purposes would likely qualify under the 'illustration for instruction' exception. The exception covers the use of material for teaching purposes subject to a number of 'fair dealing' conditions:
The kind of use of third-party copyright material is not likely to be an issue for the latter three factors, since the amount of material used in an exam paper will be minimal and will obviously be for educational purposes.