CANBERRA (Reuters) - Thousands of dead Australians landed windfall cash payments to help stimulate the recession-hit economy, while thousands of others living overseas also received money, the government said on Thursday.

The money was paid out as part of a stimulus package worth A$52 billion (S$59.28 billion) since September as the country slid into recession and the government forecast unemployment would double to one million by late next year.

Much of the money was tax refunds to poor and middle-income earners, pensioners and families with young children, but A$14 million (S$15.96 million) was paid to 16,000 dead citizens and A$25 million (S$28.5 million) to 25,000 Australians living abroad.

"Grateful dead get a raise from Kev," said one headline, refering to Prime Minister Kevin Rudd, whose Labor government's economic management credentials have long been its achilles heel.

Finance Minister Lindsay Tanner insisted the money was well spent and would still find its way into the economy.

"Even where they go to people who are dead, of course they go to the estate," he told local television".

"The estate typically is going to consist of ordinary Australians who will in turn get the payments, and on balance over time, will spend those payments," Tanner said.

He said it was impossible to determine from recent tax return records who was dead or alive.