Police have reported that 34 young men have died in recent weeks in two provinces during rituals to mark the passage into manhood at so-called initiation schools in the bush.
"Over the years, this century-old culture has been slowly corrupted and eroded to give way to commercial interests," minister Aaron Motsoaledi told lawmakers in a debate called on the deaths.
"Then mutilations and deaths started rising year by year until we are at this point", which he said was reaching crisis proportions.
South African boys from ethnic Xhosa, Sotho and Ndebele groups typically spend around a month in secluded bush or mountains areas for their initiation.
This includes the circumcision carried out by traditional surgeons -- sometimes using unsterilised instruments or lacking in technique -- as well as lessons on masculine courage and discipline.
Botched circumcisions, leading to penis amputations and deaths are an annual tragedy in South Africa. However the latest deaths, with 28 in one province alone, have prompted fresh outrage and calls for action.
"We are mostly dealing with individuals who have decided to hijack certain African cultures to amass wealth for themselves, make huge amounts of money in as short a time as possible hiding under the cloak of culture and tradition," said Motsoaledi.
A health ministry spokesman could not give details on the amounts charged other than "there's a lot of money involved".
"Those who flouted these laws must be brought to book and arrested without fear and favour regardless of their social, cultural and traditional standing," the minister told lawmakers.