This is a misconception that we are finding very hard to get rid of.
The other 25% is only notional. In reality, even using the flat rate of 20%, the amount received is 90% of the cost. If you use the derogation model of 60%, then the amount received is 120% of the cost.
You are better of then you were in FP6. We suggest you attend one of our workshops if you need to be convinced. (In addition, to make it even better, you can now charge permanent members of staff, if your books of account are setup correctly).