"There's a huge amount of irregular expenditure. I've never seen this amount of irregular expenditure. It's about R500 million," he told MPs.

There was a mismatch between money spent and houses built.

The minister said the Auditor General had presented him with a report on allegations on these and other issues.

"There are serious issues about advance payments. R481 million was paid in the 2009/10 year on behalf of contractors to suppliers," he said.

Sexwale said some of the expenditure, which could not be accounted for, was adding up and affecting housing delivery.

"They've dug themselves a hole financially. They can never get out of that hole. Every time we give them funds, they are trying to close that hole."

Sexwale had asked the AG to investigate as soon as they found out expenditure did not tally with units built.

"We also alerted Treasury late last year about these issues, and our own internal audit discovered that things are not quite well."

The AG's report would first be presented to Cabinet before it was tabled in Parliament.

"I have to present findings to the Cabinet... and then, based on that, to know what line of quick action, remedial action, needs to be taken."

There were various ways Cabinet could address the crisis.

"One of those is the constitutional prerogative," Sexwale said.

"Section 100 (of the Constitution) is not excluded, so the Constitution is the last line, also the first line."

Section 100 allows the national government to intervene in the running of a province.