Sunday afternoon in the concert hall of the Kennedy Center. The orchestra has completed an energetic, somewhat oom-pah-pahish, rendering of Franz von Suppe's "Poet and Peasant." The 33 youngsters rise smartly to receive their applause, and the conductor, red-faced and beaming, strides to their midst to congratulate the two lanky, blond girl saxophonists.

The orchestra sits, and another man, gray-bearhed and intense, comes forward. "I am Gottfried Mueller," he announces. We come here from Germany to tell you about Salem. . . . I can speak to you about these children because they do not understand English. They are all from broken homes."

Mueller is the director of the Salem Children's Trust, which he founded in Germany 15 years ago as an alternative method to foster care for orphaned children. Mueller's way is to take children living in institutions and temporary foster homes, and to give them what he believes they need most - a permanent home.

The members of the Salem Children's Orchestra are residents of one of the three Salem communities in Germany.Their "village" near the Bavarian city of Stadtsteinach, is an extended family comprised of 12 households, each with a maximum of eight children, cared for by a married couple or a single "mother," and a set of "grandparents." The children are of all ages - from infants to 17 or 18. They are, in all of the important ways, real families.

Mueller conceived of Salem about 20 years ago. Hed been a paratrooper in the war. During four years in an English pow camp (where, he reflects; "At least, I couldn't hurt anyone and no one could hurt me'), Mueller "thought about war and peace, and said to myself 'I will do something to help the poor and homeless.'

"I became a vegetarian," he says, because - pressing his hands to his mouth - "I saw that peace must begin with my lips."

After the war, Mueller approached charitable organizations with his ideas for peaceful, healthy living. But no one wanted his help. Dispirited, he forgot his idealism and pursued a successful career in insurance.

It didn't last. "I thought, 'At the end of my life, when I am down in the ground, what will people says of me - that I was so clever? So rich?' I sold my property and gave my money away. I became poor, empty pockets."

He organized several homes for his country's forgotten people," for homeless adults - alcohlics, drug addicts, jobless ex-soldiers - a quarter of a million people.

"With these men, it was always drugs and 'Give me another schnapp.' Their friends, their families were prostitutes and barkeeps . . . But they would always say to me, 'Listen, Mr. Mueller. I've gone from one home to another. I hated one mother and then the next, and the next, and now I hate everybody. Then I am in prison - naturally! I have no brother, no sister, no one."

So I said, 'What you need is a home, a standpoint, a fixed point a - how to say . . ." He turns to a colleague, who offers "roots." "Roots," Mueller saw, begin in childhood, and in 1963, Salem was born.

The children of Salem are special children, handicapped by the destructive journey from broken homes to temporary foster homes and institutions. "They are the lost," says Mueller, angrily brushing away imaginary refuse.

His cure for this abuse is a kind of total rehabilitation, including a vegetarian, "natural" food diet, and a lot of exercise. The staff of each Salem village includes physical and psychological therapists, as well as farmers, bakers and other craftsmen, who furnish the communities' material needs and give the children vocational training.

Typical of Mueller's holistic approach is a program of horseback ridding. "I remembered when I was young, how when I was riding a horse I felt like a king. With a horse you have a comrade - you must cooperate with him, you can also quarrel with a horse, but you must be polite. You learn courage, and it is physical and spiritual."

Musical training is equally important. Even the most severely handicapped children learn to play an instrument, and learn also the value of cooperation in orchestral playing. But the greatest benefit is to their confidence. Having performed before audiences in London, Boston and New York, the Salem children seem more self-assured than many professional musicians.

Waiting backstage for the start of their concert yesterday, they sat quietly or engaged in such horseplay as their immaculate blue-vested outfits would allow. They were fit-looking and ruddy-faced - trimmed-down versions of the rollicking youths in a painting by Breughel - Their serious faces give away litte, of the experience of international concertizing, or of their troubled backgrounds.

Music, says their conductors, will always be available to them as a means of support, a fall-black if they ever find themselves out of work.A group of boys, 13 and 14 years old, name their future occupations - a carpenter, a painter, a farmer . . . But, as Mueller reminds you, employed or not, these youngsters will never find themselves without a home. They can always come back to Salem - like anyone else, when the going gets tough in the outside world, they can always go home.