Clause B1/VM4 of the New Zealand Building Code allows a concession on strength reduction factors applied to foundation design for load cases involving earthquake load combinations with overstrength factors. It allows strength reduction factors of 0.8 to 0.9 compared to 0.45 to 0.60 typically specified for other load combinations. The Canterbury Earthquakes Royal Commission recommends that this concession be re-assessed. It recommends that strength reduction factors in B1/VM4 be revised to reflect international best practice including consideration of risk and reliability. This paper explores the debate. Opinions of New Zealand and international geotechnical and structural engineers are considered. New Zealand and international practice, and factors which may influence the selection of a strength reduction factor are discussed. Recommendations are provided for further research. Possible guidance for the selection of strength reduction factors for seismic capacity design is presented for further debate.