REGINA -- The minister for Saskatchewan's Crown Investments Corp. says a beheading on a Greyhound bus in Manitoba 10 years ago was the beginning of a steep decline in bus ridership in his province.

Saskatchewan shut down the government-owned Saskatchewan Transportation Co., or STC, in last year's austerity budget due to what the province said was a consistent drop in people taking the bus.

"(It) would be a number of years ago when there was that murder on the bus in Manitoba," Joe Hargrave said Friday. "It seemed to be the tipping point of ridership to really drop like a rock after that."

Vince Li, who now goes by the name Will Baker, beheaded and cannibalized a fellow passenger, 22-year-old Tim McLean, on a Greyhound bus that was bound for Winnipeg on July 30, 2008.

Li was charged with second-degree murder, but was found not criminally responsible for his actions. Li is a schizophrenic, but had not been taking his medication.

He has since received a full discharge from the mental hospital in Selkirk, Man., where he was being held.

A 2009 first-quarter report for STC said the Crown company lost 8.5 per cent of its ridership after the Greyhound beheading. STC offered a deal to seniors later that year that it said spiked ridership in that age group.

On Friday, the STC released its final annual report which showed the company carried 267,385 riders in 2005. That figure grew a total of almost 1,000 riders in the next five years.

In 2011, STC said ridership grew by almost 20,000. The CEO at that time said the increase was attributable to seat sales for seniors and to improved amenities such as Wi-Fi on coaches.

Passenger numbers slipped each following year after that.

Greyhound announced earlier this week that it is ending the majority of its passenger service in Western Canada by the end of October.

In a statement, Greyhound Canada senior vice-president Stuart Kendrick said declining ridership in rural communities was one of several factors in the decision.

"The decline in ridership that led to the difficult decision that Greyhound Canada took this week regarding its routes in Western Canada was not due to any single incident," the statement said.

Hargrave said another reason for the cancellation was that people have more options.

"The costs of flights are so much cheaper these days than they were 15 years ago," he said. "You can catch a flight to wherever for a couple hundred bucks now."

Opposition NDP critic Cathy Sproule has said her party, if elected, would re-establish some form of public transit outside of urban centres.

Fellow NDP MLA Nicole Sarauer said Friday that the STC was still an integral public service despite ridership fluctuation.

"What should have happened was STC and the government could have taken a look at how they could have better utilized the public service that they were providing, whatever that could have meant," she said.

The province spent $7.6 million in total windup costs that included severance, arbitration and legal fees.

The government made $27.6 million off the sale of assets and is in the final stages of negotiating the sale of its Regina maintenance facility.