Australia's Cardinal George Pell has defended himself against allegations that he tried to bribe a victim of child abuse to keep quiet.

David Ridsdale, who suffered at the hands of Australia's worst paedophile priest, his uncle Father Gerald Francis Ridsdale, told the Royal Commission into Institutional Responses to Child Abuse that he had spoken to Pell in 1993. He said Pell had asked: "I want to know what it will take to keep you quiet."

Ridsdale told the commission: "I have never stated that Pell offered me anything specific or tangible in our conversation, only that his attempts to direct the conversation down a particular path made me extremely suspicious of his motivations and what he was insinuating."

Another witness, Timothy Green, who was abused at a Catholic school in Victoria, told the commission that he had informed Pell in 1974 about Brother Edward Dolan's behaviour towards the boys.

"Father Pell said 'Don't be ridiculous' and walked off," Green said.

The statements to the commission are the latest in a string of damaging testimonies from former residents of Catholic children's institutions and schools in Australia.

In a statement, Cardinal Pell, now a senior official charged with cleaning up the Vatican's finances, said that he was "horrified" by the survivors' accounts of abuse. He said: "Over the last 24 hours I have been accused of being complicit in the moving of a known paedophile, of ignoring a victim's complaint, and of bribery. These matters again require an immediate response and it is important to correct the record particularly given the false and misleading headlines."

He said that he did not remember Timothy Green or the conversation and that he had not moved Fr Ridsdale to a parish where he was not known. Furthermore, he said: "I was and remain extremely sympathetic to David Ridsdale who because of his uncle suffered horrible abuse. I continue to regret the misunderstanding between us. At no time did I attempt to bribe David Ridsdale or his family or offer any financial inducements for him to be silent."

He concluded: "I have the deepest sympathy for the victims of abuse, their families and the community of Ballarat for what they have suffered. Once again, I will answer allegations and criticisms of my behaviour openly and honestly."

The Catholic Church in Australia is the most high-profile among the institutions facing investigation by the Royal Commission, set up in 2013. Revelations about the conduct of priests in Ireland have wrecked its reputation there and led to a large-scale exodus from the Church. Scandals in other countries including the US and the UK have also impacted the Church's credibility.