diff --git a/src/vs/platform/configuration/test/common/testConfigurationService.ts b/src/vs/platform/configuration/test/common/testConfigurationService.ts
index c2e63fa4dfb92..13d6c0b622aa7 100644
--- a/src/vs/platform/configuration/test/common/testConfigurationService.ts
+++ b/src/vs/platform/configuration/test/common/testConfigurationService.ts
@@ -64,12 +64,12 @@ export class TestConfigurationService implements IConfigurationService {
 	}
 
 	public inspect<T>(key: string, overrides?: IConfigurationOverrides): IConfigurationValue<T> {
-		const config = this.getValue(undefined, overrides);
+		const value = this.getValue(key, overrides);
 
 		return {
-			value: getConfigurationValue<T>(config, key),
-			defaultValue: getConfigurationValue<T>(config, key),
-			userValue: getConfigurationValue<T>(config, key),
+			value,
+			defaultValue: undefined,
+			userValue: value,
 			overrideIdentifiers: this.overrideIdentifiers.get(key)
 		};
 	}
diff --git a/src/vs/platform/extensionManagement/common/allowedExtensionsService.ts b/src/vs/platform/extensionManagement/common/allowedExtensionsService.ts
index 0d00bc2bfeb34..7a2892fd098fb 100644
--- a/src/vs/platform/extensionManagement/common/allowedExtensionsService.ts
+++ b/src/vs/platform/extensionManagement/common/allowedExtensionsService.ts
@@ -54,7 +54,8 @@ export class AllowedExtensionsService extends Disposable implements IAllowedExte
 	}
 
 	private getAllowedExtensionsValue(): AllowedExtensionsConfigValueType | undefined {
-		const value = this.configurationService.getValue<AllowedExtensionsConfigValueType | undefined>(AllowedExtensionsConfigKey);
+		const inspectValue = this.configurationService.inspect<AllowedExtensionsConfigValueType | undefined>(AllowedExtensionsConfigKey);
+		const value = inspectValue.policyValue ?? inspectValue.userValue ?? inspectValue.defaultValue;
 		if (!isObject(value) || Array.isArray(value)) {
 			return undefined;
 		}
diff --git a/src/vs/workbench/contrib/extensions/test/electron-sandbox/extensionsWorkbenchService.test.ts b/src/vs/workbench/contrib/extensions/test/electron-sandbox/extensionsWorkbenchService.test.ts
index 03fd27f96b8ff..c49ca4dfa186d 100644
--- a/src/vs/workbench/contrib/extensions/test/electron-sandbox/extensionsWorkbenchService.test.ts
+++ b/src/vs/workbench/contrib/extensions/test/electron-sandbox/extensionsWorkbenchService.test.ts
@@ -1640,6 +1640,9 @@ suite('ExtensionsWorkbenchServiceTest', () => {
 						return true;
 					},
 				});
+			},
+			inspect: (key: string) => {
+				return {};
 			}
 		});
 	}
diff --git a/src/vs/workbench/services/configurationResolver/test/electron-sandbox/configurationResolverService.test.ts b/src/vs/workbench/services/configurationResolver/test/electron-sandbox/configurationResolverService.test.ts
index 9140cb41d9e30..804966dd7ec92 100644
--- a/src/vs/workbench/services/configurationResolver/test/electron-sandbox/configurationResolverService.test.ts
+++ b/src/vs/workbench/services/configurationResolver/test/electron-sandbox/configurationResolverService.test.ts
@@ -16,7 +16,7 @@ import { ensureNoDisposablesAreLeakedInTestSuite } from '../../../../../base/tes
 import { Selection } from '../../../../../editor/common/core/selection.js';
 import { EditorType } from '../../../../../editor/common/editorCommon.js';
 import { ICommandService } from '../../../../../platform/commands/common/commands.js';
-import { IConfigurationService } from '../../../../../platform/configuration/common/configuration.js';
+import { IConfigurationOverrides, IConfigurationService, IConfigurationValue } from '../../../../../platform/configuration/common/configuration.js';
 import { TestConfigurationService } from '../../../../../platform/configuration/test/common/testConfigurationService.js';
 import { IExtensionDescription } from '../../../../../platform/extensions/common/extensions.js';
 import { IFormatterChangeEvent, ILabelService, ResourceLabelFormatter, Verbosity } from '../../../../../platform/label/common/label.js';
@@ -763,4 +763,13 @@ class MockInputsConfigurationService extends TestConfigurationService {
 		}
 		return configuration;
 	}
+
+	public override inspect<T>(key: string, overrides?: IConfigurationOverrides): IConfigurationValue<T> {
+		return {
+			value: undefined,
+			defaultValue: undefined,
+			userValue: undefined,
+			overrideIdentifiers: []
+		};
+	}
 }