Children as young as five were sent from Northern Ireland to Australian orphanages and other institutions where they were sexually and physically abused, the chairman of an inquiry into institutional child abuse has revealed.

Sir Anthony Hart, who is chairing the historical abuse inquiry, said witness evidence will show "in shocking terms" how children were subjected to "severe hardships, and grave sexual and physical evidence" when they arrived in the country.

The retired judge made his remarks during the latest session of the inquiry, held at Banbridge courthouse in County Down on Monday. This aspect of the largest public investigation into the abuse of children in state- and church-run homes is focusing on the treatment of 130 orphans and young people in care who were sent to Australia between 1946 and 1956.

Sixty-six former residents of these institutions have given evidence of how they were transported across the world without their consent. Many of those who have come forward will give evidence via video link over what happened to them under the scheme.

Hart said their evidence "will not be swept under the carpet" even though the Northern Ireland assembly-endorsed inquiry has no legal powers in relation to Australian institutions.

However, he stressed that all the evidence they gave would be passed on to a similar inquiry being carried out in Australia into state- and church-run institutions there where there were allegations of child abuse.

The public inquiry in Banbridge is the largest ever held into institutions such as orphanages anywhere in the UK. A total of 13 homes are under scrutiny in the inquiry. Both Catholic-run and state-run institutions are under examination.

The inquiry will be told that the transport of children from institutions in Northern Ireland mainly to similar ones in Western Australia was part of UK government policy at the time.

The retired judge said that many of those who were transported to Australia from Northern Ireland "have little recollection" of being sent to the other side of the world. Hart told the courthouse this was "not surprising because some of those children who were selected were as young as five years old, and many were eight or under".

Among the institutions the inquiry will investigate is the state-run Kincora Boys Home in east Belfast. Hart has revealed that much of the state material on the home remains in the hands of the Home Office and cannot be disclosed to his inquiry. There have been persistent allegations that convicted paedophiles who ran the school were being blackmailed by British intelligence officers and Special Branch and recruited as informers in the early 1970s when the Troubles erupted.

There have been demands from MPs, Amnesty International and victims of sexual abuse at Kincora to include its history in a promised Westminster inquiry into establishment figures involved in paedophile rings in Britain.